stahleyp Posted February 23, 2013 Share Posted February 23, 2013 Wanted to see what you guys thought about this one. Baupost has been picking up a quite a bit. It's down about 62% over the past year. Pretty nice cash pile - about $118...but losing quite a bit (around $80 million over the past 2 years). Baupost owns about 15% of s/o and Novarti owns about 30%. Anyone here have experience with the drug industry? And, no, I don't mean those kinda drugs! :P Link to comment Share on other sites More sharing options...
muscleman Posted February 24, 2013 Share Posted February 24, 2013 Doesn't know too much about the drug industry. I recently chatted with a doctor and he said a lot of drugs get into phase 3 and then simply never pass it. Link to comment Share on other sites More sharing options...
stahleyp Posted February 24, 2013 Author Share Posted February 24, 2013 Yeah, I know a ton of them fail. It seems Baupost does a lot with biotech, TRGT, PDLI come to mind. Link to comment Share on other sites More sharing options...
infinitee00 Posted February 24, 2013 Share Posted February 24, 2013 PDLI's business model is different from most biotechs. They are not dependent on the success or failure of medical trials. I cannot remember the source now, but I have read that only 53% of Phase 3 trials are approved. To me, investing in biotechs is like buying cheap OOM call options. Of course, if one understands the nature of the science/trials better, one may increase one success rate. Link to comment Share on other sites More sharing options...
muscleman Posted February 24, 2013 Share Posted February 24, 2013 PDLI's business model is different from most biotechs. They are not dependent on the success or failure of medical trials. I cannot remember the source now, but I have read that only 53% of Phase 3 trials are approved. To me, investing in biotechs is like buying cheap OOM call options. Of course, if one understands the nature of the science/trials better, one may increase one success rate. 53% of phase 3 trials are approved? That number is not low. That means if I can find a net-net with a phase 3 drug, then I have 53% chance to get a 10-50 begger, and 47% chance to lose a bit of my money? Link to comment Share on other sites More sharing options...
Packer16 Posted February 24, 2013 Share Posted February 24, 2013 I think the payoffs are good but not that good as there a royalty payments and slices of the future revenue that go to others in addition to competing drugs for the indication it targets. Packer Link to comment Share on other sites More sharing options...
stahleyp Posted April 1, 2013 Author Share Posted April 1, 2013 Down to around $3.50 now. Looks like Klarman is taking a beating...so far. http://seekingalpha.com/article/811061-seth-klarman-s-baupost-group-s-position-increases-during-q2-2012 "Baupost also increased its position in Idenix Pharmaceuticals (IDIX) by approximately 20 percent, from 8,249,000 to 10 million shares. Though IDIX represents less than three percent of Baupost's U.S. equity holdings, it is a position that Klarman has been accumulating for several quarters. During Q2 2012, shares of IDIX traded between about $7.40 and $10.80, with the company now trading at about $8 per share, or near the low end of its recent range. Shares of IDIX sustained a considerable drop at the end of July and start of August when the company issued a secondary stock offering, shortly after receiving a fast track designation for its proposed Hepatitis C drug. See a recent performance chart for IDIX, below" Link to comment Share on other sites More sharing options...
Philip Morris IV Posted April 5, 2013 Share Posted April 5, 2013 He is, but he is still buying. This will be the 8th consecutive quarter he has added to his stake. He supposedly owns north of 24M shares now. I'm tempted by IDIX at this price but do not know much about pharmaceuticals. Seems the new FDA breakthrough category would help IDIX, but I'd just be riding Klarman's coattails on this one. Link to comment Share on other sites More sharing options...
muscleman Posted May 5, 2013 Share Posted May 5, 2013 He is, but he is still buying. This will be the 8th consecutive quarter he has added to his stake. He supposedly owns north of 24M shares now. I'm tempted by IDIX at this price but do not know much about pharmaceuticals. Seems the new FDA breakthrough category would help IDIX, but I'd just be riding Klarman's coattails on this one. Does anyone know the investment thesis for this company? What is the upside and what is the MoS? I find it hard to understand. I hope someone can enlighten me please. :) Link to comment Share on other sites More sharing options...
CorpRaider Posted May 5, 2013 Share Posted May 5, 2013 He sure as heck was right about Theravance. I didn't pull the trigger on that one because I was kicking the tires. I surmise that the IDIX investment is about evaluating the ongoing litigation with GILD, but I dunno. He's not one to buy some speculative biotech on the hope that they will come up with something. Link to comment Share on other sites More sharing options...
muscleman Posted May 6, 2013 Share Posted May 6, 2013 He sure as heck was right about Theravance. I didn't pull the trigger on that one because I was kicking the tires. I surmise that the IDIX investment is about evaluating the ongoing litigation with GILD, but I dunno. He's not one to buy some speculative biotech on the hope that they will come up with something. Has he written anything about IDIX in his shareholder letters in the past? It seems very difficult to find these letters. Link to comment Share on other sites More sharing options...
Philip Morris IV Posted July 12, 2013 Share Posted July 12, 2013 Idenix is back down to its 52wk low around $3.24. Hasn't been this low since Q1 2011. Would be interesting to hear what Klarman has said. Baupost has been very consistent with its purchases for the last 8 quarters. Given its price history, it must be well below his avg cost basis right now (probably in the mid-$4s). Brookside Capital (the "public equity affiliate" of Bain Capital) took a 9% position in Feb, presumably in the high-$4s. Interesting observation: Baupost and Idenix offices are about 3 miles apart in Boston, with Brookside in an adjacent building to Baupost. ;D Link to comment Share on other sites More sharing options...
stahleyp Posted July 12, 2013 Author Share Posted July 12, 2013 It'll be interesting to see if he's adding. http://news.morningstar.com/all/ViewNews.aspx?article=/DJ/201306201849DOWJONESDJONLINE000711_univ.xml Link to comment Share on other sites More sharing options...
Philip Morris IV Posted July 12, 2013 Share Posted July 12, 2013 The new FDA breakthrough category could bode well for small pharma. A drug can get approved in just one phase. Klarman likes small pharma - holds Theravance, Enzon, Aveo and Idenix. With the exception of Theravance, it appears they are currently priced well below his avg cost basis. You would think the guy who authored a book titled "Margin of Safety" sees the MoS here. Link to comment Share on other sites More sharing options...
Cunninghamew Posted July 12, 2013 Share Posted July 12, 2013 ENZN might be worth looking at. http://investor.enzon.com/releasedetail.cfm?ReleaseID=758565 . You need to peg a value to the current assets and NPV of Pegintron royalty Link to comment Share on other sites More sharing options...
PullTheTrigger Posted July 12, 2013 Share Posted July 12, 2013 Posted by: Philip Morris IV « on: Today at 01:19:12 PM » Insert Quote The new FDA breakthrough category could bode well for small pharma. A drug can get approved in just one phase. Klarman likes small pharma - holds Theravance, Enzon, Aveo and Idenix. With the exception of Theravance, it appears they are currently priced well below his avg cost basis. You would think the guy who authored a book titled "Margin of Safety" sees the MoS here. I'd be careful assuming Klarman knows everything about pharmaceuticals. He invested in Acusphere back in 2007-2008 time-frame. Look at the chart now. I think he has enough money under management to occasionally take a flier on some of these potential pharmaceuticals with a small amount of capital. If it works out, great, if not, it doesn't move the needle on his performance. Link to comment Share on other sites More sharing options...
alertmeipp Posted July 12, 2013 Share Posted July 12, 2013 he is probably taking a basket approach on this. Link to comment Share on other sites More sharing options...
stahleyp Posted July 12, 2013 Author Share Posted July 12, 2013 Does anyone know of Klarman's big winners? It seems like a lot of his are missing. Look at HPQ, his bearish stance on BAC, gold etc. Link to comment Share on other sites More sharing options...
indythinker85 Posted July 12, 2013 Share Posted July 12, 2013 . Does anyone know of Klarman's big winners? It seems like a lot of his are missing. Look at HPQ, his bearish stance on BAC, gold etc. 20 percent of Baupost assets are in lehman debt. I think he mentioned in 2012 letter that all his debt investments 40%? of AUM are in 3 distressed investments. He knows letters leak a lot so maybe he is including last information but in general he mostly focuses on macro and discusses cash holdings, gold briefly, and largest investments briefly. He never discusses his biotech investments and I have no idea how he values them (I am sure he has a method and many have done quite well). Most of his letters are macro lately. Q2 is not out yet but I doubt he will discuss much about IDIX or any other small positions (assuming history is any guide). If anyone knows more information from traders, Baupost etc feel free to share, but you wont find this information in letters. In fact, even investors in his funds get very little info according to what I hear. I dont think its because of anything bad, I think its because he does not want it in media (he mentioned in last letter how media reports all the letters and he aint a fan). Cheers! Link to comment Share on other sites More sharing options...
stahleyp Posted July 13, 2013 Author Share Posted July 13, 2013 . Does anyone know of Klarman's big winners? It seems like a lot of his are missing. Look at HPQ, his bearish stance on BAC, gold etc. 20 percent of Baupost assets are in lehman debt. I think he mentioned in 2012 letter that all his debt investments 40%? of AUM are in 3 distressed investments. He knows letters leak a lot so maybe he is including last information but in general he mostly focuses on macro and discusses cash holdings, gold briefly, and largest investments briefly. He never discusses his biotech investments and I have no idea how he values them (I am sure he has a method and many have done quite well). Most of his letters are macro lately. Q2 is not out yet but I doubt he will discuss much about IDIX or any other small positions (assuming history is any guide). If anyone knows more information from traders, Baupost etc feel free to share, but you wont find this information in letters. In fact, even investors in his funds get very little info according to what I hear. I dont think its because of anything bad, I think its because he does not want it in media (he mentioned in last letter how media reports all the letters and he aint a fan). Cheers! Thanks indy. Yeah, I've heard about the lehman debt. Is most of his success based on investments outside of equities? I think stocks are only about 10% of his total AUM. Link to comment Share on other sites More sharing options...
smreitz Posted September 26, 2013 Share Posted September 26, 2013 First off, congrats to those that have held this company for the past 3 months. I didn't pull the trigger at around $3.40. Do any current holders have thoughts about the future direction of the company and their current thesis to hold on to this, other than Klarman holds it? Any fair value estimates or thoughts? Thank you in advance. Link to comment Share on other sites More sharing options...
CorpRaider Posted January 17, 2014 Share Posted January 17, 2014 Good day for this one, eh? Link to comment Share on other sites More sharing options...
VersaillesinNY Posted January 28, 2014 Share Posted January 28, 2014 Idenix announced that it has entered into a definitive agreement with certain entities managed by The Baupost Group, L.L.C. for the sale of 16,420,241 shares of its common stock. Baupost has agreed to purchase the shares of common stock at a price of $6.50 per share, resulting in net proceeds to Idenix, after deducting estimated offering expenses, of approximately $106.7M. http://www.thestreet.com/story/12279069/1/idenix-pharma-ceo-speaks-on-plans-for-the-107-million-just-raised.html?puc=yahoo&cm_ven=YAHOO Link to comment Share on other sites More sharing options...
VersaillesinNY Posted June 9, 2014 Share Posted June 9, 2014 http://dealbook.nytimes.com/2014/06/09/merck-to-acquire-idenix-pharmaceuticals/?_php=true&_type=blogs&_r=0 Thanks Mr Market. Link to comment Share on other sites More sharing options...
gurpaul88 Posted June 9, 2014 Share Posted June 9, 2014 Congrats to those who were on this. Link to comment Share on other sites More sharing options...
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