Redmile Group Sticking With Healthcare Picks After Rough Q1

#3. Clovis Oncology Inc (NASDAQ:CLVS)

 – Number of shares owned by Redmile (as of March 31): 3.09 Million

 – Value of Redmile’s stake (as of March 31): $59.5 Million

Following a 73% increase to Redmile’s holding over the first quarter, Clovis Oncology Inc (NASDAQ:CLVS) jumped three spots in the fund’s portfolio. For its part, Redmile became the fourth-largest hedge fund investor among the 24 funds in our database long the stock on March 31. Interestingly, these 24 firms held more than 54% of the company’s float, making them extremely overweight the stock. Zach Schreiber’s Point State Capital alone owned more than 9.3% of the company’s outstanding stock, or 3.59 million shares.

Unlike its peers above, Clovis Oncology Inc (NASDAQ:CLVS) has not yet managed to recuperate from a rocky start to the year. The shares of the company, which lost 45.14% over the first quarter, have fallen by an extra 10.5% in the second quarter, taking their year-to-date loss to almost 51%. Among recent news dragging down the stock was the announcement that the company would cut 35% of its staff by the end of the year, anticipating that the FDA is likely to reject its rociletinib drug for the treatment of EGFR-positive, non-small cell lung cancer. That could lead to the termination of the compound’s development as the company shifts its focus to its second asset, rucaparib, which seems to have a better chance of approval.

#2. Medivation Inc (NASDAQ:MDVN)

 – Number of shares owned by Redmile (as of March 31): 1.78 Million

 – Value of Redmile’s stake (as of March 31): $82.1 Million

Medivation Inc (NASDAQ:MDVN) remained the in the runner-up position in the fund’s portfolio, with the position having been upped by 12% during the first quarter. On top of Mr. Green’s fund, another 48 firms in our database held long positions in the stock, with their positions accounting for more than 20% of the company’s float at the end of the first quarter. The largest stake among them was held by Fred Knoll’s Knoll Capital Management, which owned 4.39 million shares worth more than $202 million.

Unlike most healthcare stocks, Medivation Inc (NASDAQ:MDVN) is up year-to-date, by more than 25%, and by more than 122% since its February lows, mostly helped by the interest of several major pharma companies in taking over the mid-cap biopharma. At first, it was only Sanofi SA (ADR) (NYSE:SNY) that seemed drawn to the company; however, as its offers were rejected, Pfizer Inc. (NYSE:PFE), AstraZeneca plc (ADR) (NYSE:AZN) and Novartis AG (ADR) (NYSE:NVS) have all reportedly entered into what now appears to be quite the bidding war.

#1. Amicus Therapeutics, Inc. (NASDAQ:FOLD)

 – Number of shares owned by Redmile (as of March 31): 10.71 Million

 – Value of Redmile’s stake (as of March 31): $90.5 Million

Amicus Therapeutics, Inc. (NASDAQ:FOLD) remained Redmile’s top pick, with the fund boosting its stake in the company by 5% between January and March. Among the other 21 funds in our database with long stakes in the company, only one held a more valuable position than Redmile, that being Perceptive Advisors. The firm run by Joseph Edelman disclosed ownership of 15.23 million shares of the company as of March 31.

Shares of Amicus Therapeutics, Inc. (NASDAQ:FOLD) are down by 20.1% year-to-date, however, they have rebounded by more than 50% since their February lows. The rebound has stalled in the second quarter however, with shares posting a loss of more than 8.25% thus far, mostly driven by the announcement of a first quarter net loss of $0.35 per share, which missed estimates by $0.01. The company also released an update to its full-year net cash spend guidance, putting it at between $135 million and $155 million. More recently, a ‘Buy’ rating from Bank of America, and European Commission approval for the company’s oral small molecule pharmacological chaperone Galafold (migalastat) have set shares trending back in the right direction.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned in this article.