One of the best ways that retail investors can try to decide which stocks will make for a promising investment is to look at what the hedge funds are doing. This can be achieved by examining a few official filings such as 13F, 13D, and 13G reports. 13F filings are done quarterly and show which positions hedge funds have taken. 13D and 13G reports are done more often, but only when a fund has taken a position of at least 5%. On Thursday, June 6, 2013, a popular biotechnology hedge fund called Baker Brothers disclosed a 22.6% ownership stake in ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD).
Baker Brothers History
Baker Brothers is a biotechnology-focused hedge fund that is owned by Julian and Felix Baker. The hedge fund is widely admired by investors because of its huge investment returns, most notably from its early investments in Pharmacyclics, Inc. (NASDAQ:PCYC) and Seattle Genetics, Inc. (NASDAQ:SGEN).
Pharmacyclics, Inc. (NASDAQ:PCYC) is a clinical-stage biopharmaceutical company focused on developing and commercializing small-molecule drugs for the treatment of cancer and immune mediated diseases. The company has soared over the past 2 years, climbing from a low of under $8.00 to a high of $93.99.
Baker Brothers started adding shares of Pharmacyclics back in the fall of 2011 and have been increasing their stake since. The company currently makes up 23% of the Baker Brothers portfolio and is worth approximately $878.4 million. And while Pharmacyclics was an impressive investment, it wasn’t the only for the Baker Brothers.
Seattle Genetics, Inc. (NASDAQ:SGEN) is a biotechnology company focused on the development and commercialization of monoclonal antibody-based therapies for cancer. Seattle Genetics’ share price has soared since 2010.
The Baker Brothers started adding shares of Seattle Genetics back in 2010 and continued adding shares as the share price increased. The company currently makes up 18% of the Baker Brothers portfolio and is worth approximately $686 million. Clearly the Baker Brothers have a strong record of success, which is carrying over to their recent investment, Acadia Pharmaceuticals (NASDAQ:ACAD).
ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) is a biopharmaceutical company focused on small molecule drugs that address unmet medical needs in neurological and related central nervous system disorders. The company has a deep pipeline of drug candidates led by pimavanserin, which is in Phase III development as a first-in-class treatment for Parkinson’s disease psychosis. ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD)’s pipeline also includes clinical-stage programs for chronic pain and glaucoma in collaboration with Allergan, Inc. (NYSE:AGN). Below is a chart diagram showing the full pipeline for ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD), along with each product’s progress.