August proved to be a strong month for hedge funds specialising in life sciences and biopharma stocks, with several firms reporting solid gains that helped many return to positive territory for the year, according to a report by Institutional investor.
One standout performer in 2024 is Janus Henderson’s Biotechnology Innovation Composite, a fund focused exclusively on biotech stocks which posted a 3.9% gain in August, bringing its year-to-date performance to an impressive 38.7%, according to the firm.
Janus’s hedge fund composite stands out due to its diversification, which includes smaller, less-liquid companies, private investments, and short positions—factors that bolstered its performance during sector downturns in recent years.
Casdin Capital’s public securities share class also remains among the top performers for the year, up roughly 40%, according to an investor. However, it saw a slight dip in August, declining by 1.8%. Unlike Janus Henderson, which has avoided down years, Casdin is still recovering from a series of losses and has not yet reached its high-water mark.
Other funds to post gains include Soleus Capital which was by 4.7% in August and taking YTD gains to 13.8%. Its success was driven in part by TG Therapeutics, which saw a 19% jump last month. The company, which focuses on treatments for B-cell malignancies and autoimmune diseases, is Soleus’s largest US-listed long position, accounting for 5.7% of assets as of the second quarter. Iovance Biotherapeutics meanwhile, another top holding, surged by 33% in August.
Suvretta’s Averill Partners saw a 1.6% gain in August, bringing its year-to-date return to 18.5%, while RA Capital Management climbed by 60 basis points in the same month, with its year-to-date performance now at 13.7%.
Some funds turned positive for the year following strong August performances, with Perceptive Advisors gaining 5% in August, pushing its year-to-date return to 3.5%. The fund’s largest US-listed long position, Amicus Therapeutics, rose by 12%, surpassing Cerevel Therapeutics, which was acquired by AbbVie on 1 August.
Cormorant Asset Management, which gained 3.3% in August, is now up 1.5% for the year. Its largest holding, MoonLake Immunotherapeutics, a biotechnology firm focused on inflammatory diseases, makes up over 21% of its assets. MoonLake stock rose 2.7% last month.
Despite a 1.3% loss in August, RTW Investments remains up 15% for the year, reflecting the broader strength of the life sciences sector in 2024.
