Baron Funds, an investment management company, released its “Baron Health Care Fund” second quarter 2023 investor letter. A copy of the same can be downloaded here. The fund advanced 9.22% (Institutional Shares) in the quarter compared to a 3.44% gain for the Russell 3000 Health Care Index (benchmark) and an 8.74% gain for the S&P 500 Index. Since its inception, on April 30, 2018, the fund gained 13.58% on an annualized basis, compared to the benchmark’s 10.85% gain and the S&P 500 Index’s 12.54% return. Favorable stock selection led the fund to outperform in the quarter. Investments in biotechnology, pharmaceuticals, and healthcare equipment accounted for most of the relative gains of the fund in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Baron Health Care Fund highlighted stocks like Eli Lilly and Company (NYSE:LLY) in the second quarter 2023 investor letter. Headquartered in Indianapolis, Indiana, Eli Lilly and Company (NYSE:LLY) is a pharmaceutical company. On July 21, 2023, Eli Lilly and Company (NYSE:LLY) stock closed at $462.04per share. One-month return of Eli Lilly and Company (NYSE:LLY) was 2.05%, and its shares gained 39.36% of their value over the last 52 weeks. Eli Lilly and Company (NYSE:LLY) has a market capitalization of $438.602 billion.
Baron Health Care Fund made the following comment about Eli Lilly and Company (NYSE:LLY) in its second quarter 2023 investor letter:
“Eli Lilly and Company (NYSE:LLY) is a global pharmaceutical company developing and marketing drugs in oncology, diabetes, Alzheimers, immunology, and other diseases. Shares climbed due to continued investor excitement around novel weight loss drugs in the GLP-1 class, including Lilly’s Mounjaro. Given demand that is orders of magnitude more than supply, the full potential of the GLP-1 class of drugs remains unclear, with sales projections eclipsing $100 billion. This number would set a new industry record by a large margin. Drug development in this space is understandably fierce, and as recently as late June, Eli Lilly revealed new data from its diabetes/obesity pipeline assets that will further enhance the value proposition offered to patients. We retain conviction.
In pharmaceuticals, our largest investment continues to be in Eli Lilly and Company. Lilly’s new diabetes drug Mounjaro is on track to be FDA approved for obesity in 2023. At a medical conference in June, Lilly announced Phase 2 clinical data for a next-generation obesity drug called retatrutide, which showed the drug achieved up to 17.5% mean weight loss at 24 weeks in adults with obesity and up to 24.2% mean weight loss at 48 weeks. Lilly also announced Phase 2 clinical data showing its once daily oral drug orforglipron achieved up to 14.7% mean weight loss at 36 weeks in adults with obesity. The results from these pipeline obesity medicines confirmed Lilly’s status as a market leader in the diabetes and obesity category. Also during the quarter, Lilly announced that its drug Donanemab slowed cognitive and functional decline in a Phase 3 study in people with early symptomatic Alzheimer’s disease. We continue to think the company should be able to grow revenue and earnings at attractive rates through the end of the decade and beyond.”
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Eli Lilly and Company (NYSE:LLY) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 72 hedge fund portfolios held Eli Lilly and Company (NYSE:LLY) at the end of first quarter which was 76 in the previous quarter.
We discussed Eli Lilly and Company (NYSE:LLY) in another article and shared Madison Sustainable Equity Fund’s views on the company. In addition, please check out our hedge fund investor letters Q2 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
