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Felix Baker’s Baker Bros. Advisors Raises Positions In These Stocks

In several new filings with the Securities and Exchange Commission, Julian and Felix Bakers‘ healthcare-focused fund Baker Bros. Advisors reported raising its positions in Seattle Genetics, Inc. (NASDAQ:SGEN) and Avanir Pharmaceuticals Inc (NASDAQ:AVNR). Baker Bros has recently purchased around 1.65 million shares of Seattle Genetics, at an average price of $34.56 raising its position to some 24.33 million shares. In Avinir, the fund took its position to 32.77 million shares, from 18.56 million shares held earlier.

Felix Baker - Baker Bros.

In Seattle Genetics, Inc. (NASDAQ:SGEN), Baker Bros. position amasses around 19.6% of the outstanding stock and is activist by nature. The fund has been a long-term shareholder of the company, first disclosing a stake in its 13F filing for the third quarter of 2004. The stock gained over 400% since then and Baker Bros has been boosting its position from 230,200 shares it held initially. As it has been situation with many other companies, Baker Bros raised its stake soon after the company reported its financial results for the third quarter, posting record sales for its ADCETRIS drug, up by 32% on the year and positive results from the phase 3 clinical trial of AETHERA drug. Seattle Genetics, Inc. (NASDAQ:SGEN) also reported a growth in revenues to $75.9 million for the third quarter, from $71.0 million a year ago. Moreover, Seattle narrowed its net loss to $0.13 per share, from $0.19 per share.

In addition to Baker Bros, other investors that own shares of Seattle Genetics, Inc. (NASDAQ:SGEN) include Jerome Pfund and Michael Sjostrom‘s Sectoral Asset Management and Israel Englander‘s Millennium Management, which own 612,200 shares and 133,200 shares as of the end of the second quarter. However, while the company amasses more than 10% of Baker Bros’ equity portfolio, other funds commited smaller amounts for their holdings.

Baker Bros also raised its stake in the $2.5 billion pharmaceutical company Avanir Pharmaceuticals Inc (NASDAQ:AVNR). The fund’s stake is passive by nature and amasses 17% of the company’s common stock. Millennium Management is another shareholder of the company, last reporting ownership of around 4.87 million shares, up by over 100% on the quarter. Ken Griffin‘s Citadel Investment Group is even more confident about the prospects of Avanir, as it surged its stake by more than 9,000% during the second quarter, to 1.20 million shares.

Baker Bros has been holding shares of Avanir Pharmaceuticals Inc (NASDAQ:AVNR) since the second quarter of last year and over the last several quarters, the position has been raised from 3.58 million shares held initially. The fund struck gold with this investment, since Avanir’s stock surged by over 180% since the second quarter of 2013, while in September it jumped from around $6.70 to over $12 per share  after the company reported positive results from its phase 2 trial for an Alzheimer’s disease drug. On the back of the news, several analysts boosted their price targets, maintaining bullish ratings. One of these analysts were Mizuho, who surged the price target for the company’s stock to $16.00 from $10.00.

Baker Bros. has generally been bullish on many holdings recently. In October, the fund raised its position in XenoPort, Inc. (NASDAQ:XNPT) to 11% of the company, while the stock gained over 35% over the last month. In Synageva BioPharma Corp (NASDAQ:GEVA), Baker Bros. upped its position to 10.88 million shares through conversion of stock options.

Healthcare sector, in general has witnessed a significant increase in bullish sentiment from investors. While some experts expect the sector to slow down its growth after the failure of some mergers such as AbbVie Inc (NYSE:ABBV)/Shire PLC (ADR) (NASDAQ:SHPG). However, the sector still sees some interesting developments, such as Bill Ackman and Valeant Pharmaceuticals Intl Inc (NYSE:VRX)’s plans to acquire Allergan, Inc. (NYSE:AGN) and Bill Ackman’s recent activist stake in Zoetis Inc (NYSE:ZTS). With this in mind, we will keep a close eye on investors’ moves in the sector and will keep you updated.

Disclosure: none

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