10 Pharmaceutical Stocks to Buy According to Lawrence Hawkins’ Prosight Capital

Published October 15, 2021 at 2:12 pm EDT Updated August 19, 2026 at 5:24 am EDT

In this article, we discuss 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital.

Lawrence Hawkins, the managing partner of Dallas-based Prosight Capital, has had a successful career as an investor spanned over 18 years. The portfolio value of his hedge fund at the end of second quarter of 2021 was $159 million. The top ten holdings of the hedge fund comprised 54.86% of the portfolio. Hawkins has loaded up on pharmaceutical companies. His holdings are concentrated mostly in healthcare and services industries.

According to the latest security filings, the portfolio value of Prosight Capital increased by almost $37 million between March and June this year. The fund made new purchases in 17 stocks, bought additional stakes in 15 equities, sold out of 8 stocks, and reduced holdings in 14 stocks during the second quarter.

The pharmaceutical industry plays a very important role in research, discovery and development of new medicines. Some of the most famous pharmaceutical companies are Moderna, Inc. (NASDAQ:MRNA), Bristol-Myers Squibb Company (NYSE:BMY) and Pfizer Inc. (NYSE:PFE), among others.

Our Methodology

With this context in mind, here is our list of the 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital. These were ranked according to the investment portfolio of Prosight Capital at the end of the second quarter of 2021. The list was compiled according to the value of each holding in the Prosight Capital portfolio.

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10. Zimmer Biomet Holdings, Inc. (NYSE:ZBH)

Prosight Capital Stake Value: $5 million

Percentage of Prosight Capital’s 13F Portfolio: 3.16%

No. of Hedge Fund Holders: 48

Ranked tenth on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital is Zimmer Biomet Holdings, Inc. (NYSE:ZBH). It is a medical device company with a market cap of $3 billion. The company makes orthopedic, dental and spinal reconstructive implants and related surgical equipment.

According to latest 13F fillings, Hawkins’ Prosight Capital owns 31,500 shares worth $5 million in Zimmer Biomet Holdings, Inc.. This represents 3.16% of Prosight Capital’s holdings. At the end of the second quarter of 2021, 48 hedge funds in the database of Insider Monkey held stakes worth $1.8 billion in Zimmer Biomet Holdings, Inc., down from 50 in the previous quarter worth $2 billion.

On October 1, investment advisory Citi kept a Buy rating on Zimmer Biomet Holdings, Inc. stock and lowered its price target to $188 from $200.

In the second quarter of 2021, Zimmer Biomet Holdings, Inc. reported an EPS of $1.90, surpassing estimates by $0.04. The company’s revenue in the second fiscal quarter came in at $2.03 billion, an increase of 65% year over year, and beat revenue estimates by $50 million.

9. Zogenix, Inc. (NASDAQ:ZGNX)

Prosight Capital Stake Value: $5.3 million

Percentage of Prosight Capital’s 13F Portfolio: 3.3%

No. of Hedge Fund Holders: 28

Zogenix, Inc. (NASDAQ:ZGNX), headquartered in Emeryville, California, develops therapeutic solutions to provide treatment for diseases associated with the central nervous system. The company ranks ninth on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital.

In the second quarter of 2021, Zogenix, Inc. reported an EPS of -$1.05, missing estimates by $0.12. The company’s revenue in the second quarter came in at $18.79 million, an increase of 1724.3% year over year, and beat revenue estimates by $2.19 million.

On September 9, UBS initiated coverage of Zogenix, Inc. stock with a Buy rating and a price target of $23, adding that it expects the company to generate more sales momentum.

Our data shows that RA Capital Management is one of the leading shareholders in Zogenix, Inc. with more than 5 million shares worth $91 million.

At the end of the second quarter of 2021, 28 hedge funds in the database of Insider Monkey held stakes worth $345.7 million in Zogenix, Inc., up from 21 in the previous quarter worth $377.4 million.

Just like Moderna, Inc., Bristol-Myers Squibb Company and Pfizer Inc., Zogenix, Inc. is also one of the top stocks to invest in.

8. Exicure, Inc. (NASDAQ:XCUR)

Prosight Capital Stake Value: $5.4 million

Percentage of Prosight Capital’s 13F Portfolio: 3.37%

No. of Hedge Fund Holders: 10

Ranked eighth on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital is Exicure, Inc. (NASDAQ:XCUR). The company develops, based on its Spherical Nucleic Acid (SNA) technology, therapies for immuno-oncology and genetic diseases. Hawkins’ Prosight Capital increased its stake in Exicure, Inc. by 1206% in the second quarter of 2021 as compared to the first quarter.

In the second quarter of 2021, Exicure, Inc. reported an EPS of -$0.16, missing estimates by $0.02. The company’s revenue in the second fiscal quarter came in at $0.08 million and missed revenue estimates by $1.36 million. Out of the hedge funds being tracked by Insider Monkey, Tybourne Capital Management is one of the biggest stakeholders in Exicure, Inc. with more than 7 million shares worth $11 million.

Like Moderna, Inc., Bristol-Myers Squibb Company and Pfizer Inc., Exicure, Inc. is one of the notable pharma stocks.

7. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX)

Prosight Capital Stake Value: $5.5 million

Percentage of Prosight Capital’s 13F Portfolio: 3.41%

No. of Hedge Fund Holders: 60

Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX), headquartered in Boston, Massachusetts, ranks seventh on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital. It has a market cap of $46.6 billion. The company develops therapies for the treatment of cystic fibrosis, infectious diseases, autoimmune diseases and neurological disorders.

Based on latest 13F fillings, Hawkins’ Prosight Capital owns 27,100 shares worth $5.5 million in Vertex Pharmaceuticals Incorporated, which makes up 3.41% of Hawkins’ 13F portfolio. At the end of the second quarter of 2021, 60 hedge funds in the database of Insider Monkey held stakes worth $2.8 billion in Vertex Pharmaceuticals Incorporated, down from 68 the preceding quarter worth $3.7 billion.

According to second fiscal quarter results Vertex Pharmaceuticals Incorporated reported an EPS of $3.11, surpassing analyst estimates by $0.75. The company’s revenue in the second fiscal quarter came in at $1.79 billion, an increase of 17.8% year over year, and beat revenue estimates by $60 million.

On September 9, Stifel downgraded Vertex Pharmaceuticals Incorporated stock to Hold from Buy rating and decreased its price target to $213 from $244.

In its Q2 2021 investor letter, Harding Loevner, an investment management firm, mentioned that Vertex Pharmaceuticals Incorporated is one of largest detractors from relative performance: Here is what the fund said:

“Among the largest detractors from relative performance (includes) Vertex Pharmaceuticals. Vertex fell after the company halted development of one of its drug candidates undergoing Phase 2 trials. The failure leaving some investors wondering if Vertex’s much-heralded research capabilities might not extend beyond its core franchise in cystic fibrosis, a view we respectfully reject.”

6. Kezar Life Sciences, Inc. (NASDAQ:KZR)

Prosight Capital Stake Value: $5.6 million

Percentage of Prosight Capital’s 13F Portfolio: 3.47%

No. of Hedge Fund Holders: 12

Our data show that Logos Capital is one of the biggest stakeholders in Kezar Life Sciences, Inc. (NASDAQ:KZR) with more that 2 million shares worth $12.5 million. At the end of the second quarter of 2021, 12 hedge funds in the database of Insider Monkey held stakes worth $46.4 million in Kezar Life Sciences, Inc., down from 13 the preceding quarter worth $37.4 million.

On September 20, investment advisory Jones Trading initiated coverage of Kezar Life Sciences, Inc. stock with a Buy rating and a price target of $14.

5. Aldeyra Therapeutics, Inc. (NASDAQ:ALDX)

Prosight Capital Stake Value: $6.7 million

Percentage of Prosight Capital’s 13F Portfolio: 4.21%

No. of Hedge Fund Holders: 18

Aldeyra Therapeutics, Inc. (NASDAQ:ALDX) is a biotechnology company based in Lexington, Massachusetts and it ranks fifth on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital. The company’s prime focus is to develop immune-modulating therapies for the treatment of ocular and systemic disorders. Reproxalap is the company’s principal product. In the second quarter of 2021, Aldeyra Therapeutics, Inc. reported an EPS of -$0.28, missing estimates by $0.03.

Hawkins’ Prosight Capital owns 595,239 shares worth $6.7 million in Aldeyra Therapeutics, Inc.. This represents 4.21% of the total holdings of Prosight Capital. The hedge fund increased stake in the company by 26% during the second quarter of 2021 compared to the first quarter.

At the end of the second quarter of 2021, 18 hedge funds in the database of Insider Monkey held stakes worth $189 million in Aldeyra Therapeutics, Inc., up from 17 the preceding quarter worth $153.9 million.

4. Cue Biopharma, Inc. (NASDAQ:CUE)

Prosight Capital Stake Value: $7.3 million

Percentage of Prosight Capital’s 13F Portfolio: 4.59%

No. of Hedge Fund Holders: 15

Ranked fourth on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital is Cue Biopharma, Inc. (NASDAQ:CUE). It is headquartered in Massachusetts, United States. This clinical-stage biopharmaceutical firm is developing a new class of injectable biologics that precisely engage and control targeted T cells within the body to treat cancer and autoimmune diseases. Hawkins’ Prosight Capital increased stake in Cue Biopharma, Inc. by 14% during the second quarter of 2021 compared to the first quarter.

In the second quarter of 2021, Cue Biopharma, Inc. reported an EPS of -$0.33, beating estimates by $0.05. The company’s revenue in the second quarter came in at $2.73 million, an increase of 152.8 % year over year, and beat revenue estimates by $1.69 million.

At the end of the second quarter of 2021, 15 hedge funds in the database of Insider Monkey held stakes worth $101.3 million in Cue Biopharma, Inc., up from 14 the preceding quarter worth $106.5 million.

3. Haemonetics Corporation (NYSE:HAE)

Prosight Capital Stake Value: $8.9 million

Percentage of Prosight Capital’s 13F Portfolio: 5.58%

No. of Hedge Fund Holders: 30

Haemonetics Corporation (NYSE:HAE), headquartered in Boston, Massachusetts, is ranked third on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital. The company creates, manufactures and sells automated blood processing equipment.

Hawkins’ Prosight Capital owns 134,000 shares worth $8.9 million in Haemonetics Corporation which represents 5.58% of Hawkins’ 13F portfolio.

At the end of the second quarter of 2021, 30 hedge funds in the database of Insider Monkey held stakes worth $392.9 million in Haemonetics Corporation, down from 37 the preceding quarter worth $585.5 million.

2. Arena Pharmaceuticals, Inc. (NASDAQ:ARNA)

Prosight Capital Stake Value: $9 million

Percentage of Prosight Capital’s 13F Portfolio: 5.84%

No. of Hedge Fund Holders: 34

Arena Pharmaceuticals, Inc. (NASDAQ:ARNA), headquartered in San Diego, California, is a biopharmaceutical company with a market cap of $3.6 billion. The firm provides transformational medications with improved pharmacology and pharmacokinetics. In the second quarter of 2021, Arena Pharmaceuticals, Inc. reported an EPS of -$2.40, missing estimates by $0.22.

According to latest security filings, Hawkins’ Prosight Capital increased stake in Arena Pharmaceuticals, Inc. by 30% during the second quarter of 2021 compared to the first quarter. The company represents 5.84% of the total investment portfolio of the hedge fund at the end of the second quarter of 2021. Our data shows that VenBio Select Advisor is one of the biggest stakeholders in Arena Pharmaceuticals, Inc. with 4 million shares worth $277.9 million.

On August 10, investment advisory Cantor Fitzgerald lowered its price target on Arena Pharmaceuticals, Inc. to $93 from $100, keeping an Overweight rating on the shares. Alethia Young, an analyst at the firm, added that she anticipates many catalysts in the pipeline over the next 12-18 months that could propel the stock far higher from present levels.

At the end of the second quarter of 2021, 34 hedge funds in the database of Insider Monkey held stakes worth $756.6 million in Arena Pharmaceuticals, Inc., up from 33 the preceding quarter worth $822.6 million.

1. Prothena Corporation plc (NASDAQ:PRTA)

Prosight Capital Stake Value: $21.7 million

Percentage of Prosight Capital’s 13F Portfolio: 13.56%

No. of Hedge Fund Holders: 20

Ranked first on the list of 10 pharmaceutical stocks to buy according to Lawrence Hawkins’ Prosight Capital is Prothena Corporation plc (NASDAQ:PRTA). It is a late-stage clinical firm located in Ireland. The company’s research and development efforts are focused on the discovery and development of new antibodies for the treatment of a variety of disorders involving protein misfolding and cell adhesion.

Hawkins’ Prosight Capital owns 422,000 shares worth $21.7 million in Prothena Corporation plc (NASDAQ:PRTA), which makes up 13.56% of Hawkins’ 13F portfolio.

On September 30, RBC Capital analyst Kennen MacKay kept an Outperform rating on Prothena Corporation plc (NASDAQ:PRTA) stock with an increase in price target to $82 from $59.

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