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Peter Kolchinsky’s New Top Healthcare Pick And Old Favorites

Moving on to RA Capital Management’s second-largest holding, Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN); the fund increased its stake in its former top holding by 21% to around 9.95 million shares. At the end of June, this stake was worth $88.12 million. Shares of the biopharmaceutical company have had a rough 2015, down by 10.1% in the second quarter and almost 40% year-to-date. On August 10 the company reported worse-than-expected second quarter results. While the Street was expecting the company to declare an EPS loss of $0.18 for the quarter, the company declared an EPS loss of $0.25 instead. Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) announced a $1.1 billion deal with Johnson & Johnson (NYSE:JNJ) in May this year whereby the latter will be investing $225 million in the former and will also be developing and selling the former’s Hepatitis C drugs. In the past couple of months there have been several rumors circulating that Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN) is a prime takeover target for major pharmaceutical firms. Phill Gross and Robert Atchinson‘s Adage Capital Management also increased its stake in the company , by 6% to over 3.0 million shares during the April-June period.

Although RA Capital Management reduced its stake in Dyax Corp. (NASDAQ:DYAX) by 35% to slightly over 2.7 million shares during the quarter, the company still ended up becoming  RA Capital Management’s third-largest holding for the latest reporting period, owing to the phenomenal 58% rise in its stock during the April-June period. On July 29, the company reported mixed second quarter earnings. While its EPS loss of $0.06 was worse than the $0.04 loss analysts were expecting, revenue of $264 million blew away analysts’ estimates of just $23.40 million. Analysts at Jefferies Group reiterated their ‘Buy’ rating on July 2 and set a price target of $31 on the stock, representing a potential 35% upside to its current trading price. Although RA Capital Management reduced its stake in the company, renowned healthcare-focused hedge fund Baker Bros. Advisors, managed by Julian Baker and Felix Baker, increased its stake in Dyax Corp. (NASDAQ:DYAX)  during the second quarter by 31% to almost 8.0 million shares.

Disclosure: None

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