According to a recent 13G form filed with the Securities and Exchange Commission, Kevin Kotler‘s Broadfin Capital has initiated a stake in ContraFect Corp (NASDAQ:CFRX) to the tune of 1.42 million shares. The holding represents 7.0% of the $92.87 million biotechnology company’s outstanding common stock. Kevin Kotler launched his healthcare-focused New York-based fund in 2005 with the intention to emphasize company fundamentals and to invest with a long-term horizon. Throughout his career, Kotler has been analyzing and investing in medical technology companies and today Broadfin has investments in all the major sub-sectors of the healthcare industry. The fund currently has more than $1 billion in assets under management, and the market value of its public equity portfolio stood at $1.28 billion at the end of March. Although some holdings are from the finance and materials sectors, healthcare represents 89% of the fund’s portfolio value. Aside from ContraFect Corp (NASDAQ:CFRX), the top micro-cap picks of the fund at the end of March included Flamel Technologies S.A. (ADR) (NASDAQ:FLML) and Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR).
We don’t just track the latest moves of hedge funds. We are, in fact, more interested in their 13F filings, which we use to determine the top 15 small-cap stocks held by the funds we track. We gather and share this information based on 16 years of research which showed that these 15 most popular small-cap picks have a great potential to outperform the market, beating the S&P 500 Total Return Index by nearly one percentage point per month in backtests, and easily beating the most popular large-cap picks of funds, which nonetheless get the majority of their collective capital. Why pay fees to invest in both the best and worst ideas of a particular hedge fund when you can simply mimic only the very best ideas of the best fund managers on your own? Since the beginning of forward testing in August 2012, the Insider Monkey small-cap strategy has outperformed the market every year, returning 142%, nearly 2.5 times greater returns than the S&P 500 during the same period (see more details).
Follow Kevin Kotler's Broadfin Capital
Hospital acquired infections are currently the fourth-leading cause of death in U.S. after heart disease, cancer, and stroke. ContraFect Corp (NASDAQ:CFRX) is focused on the development of therapeutic protein and antibody products for such life-threatening, drug-resistant infectious diseases. The company held its IPO in September last year and is down by about 9% since then, however, the stock has appreciated by nearly 36% year-to-date.
Broadfin trimmed its second-largest holding, in Flamel Technologies S.A. (ADR) (NASDAQ:FLML), by 8% during the first quarter to lower the total stake to 4.72 million shares valued at $24.87 million. The holding represents more than 12% of the company’s outstanding shares and about 7% of the fund’s portfolio value. So far this year, Flamel Technologies S.A. (ADR) (NASDAQ:FLML)’s stock has posted solid gains of 13.25%. However, this performance is overshadowed by the biotechnology industry’s rise of over 17% during the same period. The $780 million pharmaceutical company’s products include Bloxiverz and Coreg CR. The former is an injection used in the operating room to reverse the effects of non-depolarizing neuromuscular blocking agents after surgery, while the latter is used for treating high blood pressure or certain types of heart failure. After Broadfin, the two largest stockholders of Flamel Technologies S.A. (ADR) (NASDAQ:FLML) within our database are James E. Flynn‘s healthcare-focused fund Deerfield Management and Israel Englander‘s Millennium Management, with respective stakes of 4.07 million shares valued at $73.23 million and 1.83 million shares valued at $32.94 million.
During the first quarter Broadfin slightly cut its stake in Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR) by 1% to 2.5 million shares valued at $65.49 million. The holding represents 8.76% of the company’s outstanding stock and 5.1% of the fund’s portfolio value. The stock of the $554.58 million biopharmaceutical company, which is engaged in developing treatments for patients with debilitating rare diseases, has fallen by 7.5% so far this year. In its financial results for the first quarter, Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR) beat both the top and bottom line estimates. However, there is a considerable amount of uncertainty surrounding the company’s future prospects. It only has one main product, Juxtapid and there is a need for diversification as competition for that drug brews up. Matt Sirovich and Jeremy Mindich’s Scopia Capital is the largest stockholder of Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR) within our database, owning some 5.35 million shares valued at $140.01 million.
Disclosure: None
