In this article, we discuss the top 10 long-term stock picks of billionaire Joseph Edelman.
Joseph Edelman is a renowned figure in the investment world, recognized for his expertise in biotechnology and healthcare investing. As the founder, CEO, and portfolio manager of Perceptive Advisors, Edelman has built a reputation as one of the most successful and insightful investors in the biotech sector. His deep understanding of the scientific, clinical, and financial aspects of the industry has enabled him to identify promising companies and generate significant returns for his investors.
Joseph Edelman earned his Bachelor of Arts in Psychology from the University of California, San Diego, and later pursued an MBA from NYU Stern School of Business. He began his career as a biotechnology analyst at Prudential Securities and subsequently worked as a portfolio manager at Paramount Capital Asset Management. These early roles provided Edelman with a foundation in analyzing biotech companies, understanding their value drivers, and assessing the risks associated with drug development and regulatory approval processes.
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In 1999, Edelman founded Perceptive Advisors, a New York-based investment firm focused on the life sciences sector. The firm initially launched with a single hedge fund, the Perceptive Life Sciences Fund, and has since expanded to manage billions of dollars in assets. Perceptive Advisors specializes in identifying high-growth potential in emerging biotech, pharmaceutical, and healthcare companies, with an emphasis on innovation in areas such as gene therapy, oncology, and rare diseases. Under Edelman’s leadership, Perceptive Advisors has achieved remarkable success.
The firm manages over $4.7 billion in the 13F portfolio as of the end of the third quarter of 2024. The Perceptive Life Sciences Fund has delivered annualized returns exceeding 15% over the past two decades, far outpacing broader market indices. Edelman has been an early backer of biotech companies that went on to achieve significant breakthroughs, including Moderna and CRISPR Therapeutics. While Edelman’s track record is stellar, the biotech sector’s inherent risks mean that not all investments succeed. Regulatory setbacks, clinical trial failures, and market sentiment can lead to significant volatility.
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For this article, we selected stocks by combing through the 13F portfolio of Perceptive Advisors at the end of the third quarter of 2024. Only the companies that have been in the 13F portfolio of the fund consistently for the past three years were selected. These stocks are also popular among other hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Billionaire Joseph Edelman’s Top 10 Long-Term Stock Picks
10. Crinetics Pharmaceuticals, Inc. (NASDAQ:CRNX)
Number of Hedge Fund Holders: 37
Perceptive Advisors’ Stake: $5.1 million
Crinetics Pharmaceuticals, Inc. (NASDAQ:CRNX) is a pharmaceutical company that develops much-needed therapies for people with rare endocrine diseases. The following factors make the firm an appealing investment choice. Firstly, significant financial growth was seen as per the reports of the third quarter of 2024, illustrating $862.7 million in cash, cash equivalents, and investment securities as compared to $558.6 million in the previous year. Secondly, another project that makes this company worth investing in is the launch of an oral treatment for Acromegaly. The company has announced the approval of its New Drug Application (NDA) for the treatment and long-term maintenance therapy of acromegaly in adults.
9. Tarsus Pharmaceuticals, Inc. (NASDAQ:TARS)
Number of Hedge Fund Holders: 22
Perceptive Advisors’ Stake: $5.4 million
Tarsus Pharmaceuticals, Inc. (NASDAQ:TARS) is a biopharmaceutical company dedicated to developing innovative therapies for eye diseases and much more. Robust financial growth and initiatives to enhance eye care and infectious disease prevention make Tarsus Pharmaceuticals a great investment choice. For instance, as per the report of the third quarter of 2024, product sales were $48.1 million compared to $1.7 million for the same period in 2023, driven by more than 41,400 bottles of XDEMVY (lotilaner ophthalmic solution) delivered to patients compared to 1,700 bottles delivered in the prior year period. Secondly, another important milestone the company achieved was the approval for XDEMVY 0.25%. This is for the treatment of demodex blepharitis, a common eyelid condition.
8. Aldeyra Therapeutics, Inc. (NASDAQ:ALDX)
Number of Hedge Fund Holders: 11
Perceptive Advisors’ Stake: $6.1 million
Aldeyra Therapeutics, Inc. (NASDAQ:ALDX) is a biotechnology company devoted to improving lives by inventing, developing, and commercializing next-generation medicines that treat immune-mediated, autoimmune and metabolic diseases. The following factors make Aldeyra Therapeutics a great investment opportunity. First, significant financial growth was seen, as illustrated in the report of the third quarter of 2024, highlighting $122.9 million in cash and cash equivalents. Secondly, innovative projects, like introducing Reproxalap, a new drug application for the treatment of dry eye disease, serve as a great milestone for the company. As per the recent news, the New Drug Application (NDA) for Reproxalap has been accepted for review by the US Food and Drug Administration (FDA), with a Prescription Drug User Fee Act (PDUFA) date set for April 2025. Moreover, the company has expanded its pipeline into retinal diseases through the acquisition of Helio Vision, a company focused on developing therapies for retinal conditions. This initiative will diversify the company’s portfolio.
7. MeiraGTx Holdings plc (NASDAQ:MGTX)
Number of Hedge Fund Holders: 14
Perceptive Advisors’ Stake: $6.3 million
MeiraGTx Holdings plc (NASDAQ:MGTX) offers a broad pipeline of preclinical and research programs, and provides gene therapy manufacturing and transformative gene regulation technology. The following factors make MeiraGTx Holdings a great place to invest. Firstly, significant financial growth was seen as illustrated in the report of the third quarter of 2024; the company reported revenue of $10.9 million, significantly surpassing the analyst estimates of $1.63 million. In addition, the cash and cash equivalents were approximately $122.9 million. Secondly, the company’s multiple pipeline programs also hold potential for investment. For instance, a Phase-2 trial was initiated targeting radiation-induced xerostomia (RIX), a debilitating condition resulting from head and neck cancer treatments. Another pipeline program is addressing Sjogren’s syndrome, an autoimmune disease affecting salivary glands.
6. Artivion, Inc. (NYSE:AORT)
Number of Hedge Fund Holders: 17
Perceptive Advisors’ Stake: $6.7 million
Artivion, Inc. (NYSE:AORT) is a medical device company specializing in cryogenically preserved human tissues and innovative surgical solutions, notably heart valves and surgical adhesives. There are multiple factors that make Artivion a golden opportunity to invest in. Firstly, in the third quarter of 2024, the company reported revenue of $95.8 million as compared to $87.9 million in the third quarter of 2023, showing an increase of 9% on a GAAP basis and 10% on a non-GAAP constant currency basis. Secondly, the company has invested an additional $25 million in Endospan to support the Food and Drug Administration approval path for the NEXUS Stent Graft System. It is designed for the aortic arch disease and specializes in controlling 2-stage procedures. Moreover, the company has also received regulatory approval to commercialize BioGlue in China, a significant market with substantial growth potential.
5. Immatics N.V. (NASDAQ:IMTX)
Number of Hedge Fund Holders: 32
Perceptive Advisors’ Stake: $13.4 million
Immatics N.V. (NASDAQ:IMTX) is a clinical-stage biopharmaceutical company that focuses on the research and development of potential T-cell redirecting immunotherapies for the treatment of cancer in the United States. There are multiple factors, such as strong financial performance, strategic partnerships, and a growing development pipeline, that make this company a good investment opportunity. For instance, as per the report of the third quarter of 2024, total revenue, consisting of revenue from collaboration agreements, was $56.7 million as compared to $6.6 million of the last year. In addition, the research and development investment was $48 million, underscoring a focused commitment to advancing the therapeutic pipeline.
4. Verona Pharma plc (NASDAQ:VRNA)
Number of Hedge Fund Holders: 25
Perceptive Advisors’ Stake: $13.8 million
Verona Pharma plc (NASDAQ:VRNA) is a United Kingdom-based biopharmaceutical company that focuses on developing and commercializing therapeutics for the treatment of respiratory diseases with unmet medical needs. There are multiple factors that make Verona Pharma worth investing in. Firstly, as per the report of the third quarter of 2024, significant financial growth was seen as the net sales reported were $5.6 million, largely due to product sales of Ohtuvayre. Secondly, the company’s strategic projects like Ensifentrine hold future potential for investors. It is a first-in-class dual inhibitor of PDE3 and PDE4, targeting inflammation and bronchodilation in COPD patients. Moreover, Verona Pharma has partnered with Ritedose for the development and manufacturing of Ohtuvayre.
3. Iovance Biotherapeutics, Inc. (NASDAQ:IOVA)
Number of Hedge Fund Holders: 30
Perceptive Advisors’ Stake: $19.1 million
Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) is the global leader in innovating, developing and delivering Tumor Infiltrating Lymphocyte (TIL) therapies for patients with cancer. As per the report of the third quarter revenue of 2024, the company recognized total revenue of $58.6 million from sales of Amtagvi and Proleukin. Moreover, the company’s state-of-the-art manufacturing facility in Philadelphia also ensures efficiency in the production of TIL therapies. This is great as it reduces dependency on third manufacturing and enhances operational control.
2. Amicus Therapeutics, Inc. (NASDAQ:FOLD)
Number of Hedge Fund Holders: 38
Perceptive Advisors’ Stake: $19.1 million
Amicus Therapeutics, Inc. (NASDAQ:FOLD) is a global, patient-dedicated biotechnology company focused on discovering, developing, and delivering high-quality medicines for people living with rare metabolic diseases. As per the reports of the third quarter of 2024, the company reported a total revenue of $100.5 million, reflecting a 17% year-over-year increase. This growth was primarily driven by the continued success of the company’s oral precision medicine for Fabry disease. Moreover, Amicus Therapeutics announced the approval and launch of new Pompe disease therapy in the European Union.
1. Nuvalent, Inc. (NASDAQ:NUVL)
Number of Hedge Fund Holders: 34
Perceptive Advisors’ Stake: $19.1 million
Nuvalent, Inc. (NASDAQ:NUVL) is a clinical-stage biopharmaceutical company that develops therapies for patients with cancer. There are several factors like increased net revenue, innovative drug pipeline, and focus on precision oncology that make this company worth investing in. For instance, as per the report of the third quarter of 2024, cash equivalents and marketable securities of the company were $1.2 billion. This financial runaway is expected to sustain operations into 2026, providing multiple resources to advance its clinical programs. Moreover, the company’s lead candidates, NVL-655 and NVL-520, target cancers driven by ROS1 and ALK gene alterations.
While we acknowledge the potential of Nuvalent, Inc. (NASDAQ:NUVL) as an investment, our conviction lies in the belief that some stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a stock that is more promising than Nuvalent, Inc. (NASDAQ:NUVL) but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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