In a new filing with the Securities and Exchange Commission, Steven Cohen‘s Point72 Asset Management disclosed a new stake in Catalyst Pharmaceutical Partners, Inc. (NASDAQ:CPRX). The position is passive by nature and amasses 3.50 million shares, which represent 5.1% of the company’s common stock. Historically the stocks that Steve Cohen had at least 5% stake in outperformed the market by an average of 48 basis points per month. Between 1999 and 2012 these stocks returned 0.8% per month vs. 0.32% for the S&P 500 Index. More recently, the outperformance figure went down to 13 basis points per month. Between 2008 and 2012 these stocks returned 0.42% per month on average vs. 0.29% gain for the S&P 500 Index.
Catalyst Pharmaceutical Partners gained around 9% since Point72 initiated a position in the company. Point72 Asset Management holds a diversified equity portfolio worth around $13.3 billion, out of which 11% is represented by healthcare stocks. In the last several months, Mr. Cohen has made several bets on healthcare stocks, which however have proved a bit disappointing so far. During the first week of October, Point72 initiated a stake in CymaBay Therapeutics Inc (NASDAQ:CBAY), which amasses 844,900 shares, while the stock declined by some 9% since then. Another new stake was represented by Applied Genetic Technologies Corp (NASDAQ:AGTC), of which the fund reported ownership of 957,800 shares; the stock gained around 10% since it was included in Point72’s equity portfolio. On the other hand, the stock of Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR) lost more than 35% since Point72 disclosed raising its position to 1.39 million shares, from 923,000 shares held earlier.
What do all stocks that Point72 has been bullish on lately have in common? They are all small cap, development stage, biopharmaceutical companies, so Mr. Cohen has basically bet on these companies gaining ground quickly on the back of clinical trials results or some improvements in financial results. Catalyst Pharmaceutical Partners, Inc. (NASDAQ:CPRX) is engaged in developing and commercializing therapies for people with debilitating diseases and a couple of months ago it reported positive top-line results from its Phase 3 clinical trial of Firdapse, a drug used for the treatment of Lambert-Eaton myasthenic syndrome. The company plans to launch an expanded access program, as well as to initiate a rolling NDA submission for the drug. In addition the company expects to release top-line results from Tourette’s Disorder Phase I/II investigator sponsored study.
In addition, several other healthcare-oriented funds have been bullish on Catalyst Pharmaceutical Partners, Inc. (NASDAQ:CPRX). During the third quarter, Julian Baker And Felix Baker’s Baker Bros. Advisors raised its position by more than 200% to 6.72 million shares, while Jacob Gottlieb’s Visium Asset Management reported holding 1.50 million shares of the company. Moreover, at the beginning of October, David Muth, executive VP for Corporate Development of the company purchased 10,000 shares at $2.65 apiece and raised his holding to 20,000 shares.
With this in mind, taking into account that Biotech is a fast growing industry, which returned 43% over the last year, posting the highest growth among all industries comprising the healthcare sector, Catalyst Pharmaceutical Partners, Inc. (NASDAQ:CPRX) is a stock that is worth some further research. In addition it trades at a significant discount to its average target price, which amounts to $8.70, while the consensus rating for the stock is ‘Buy’.