||Gilead Sciences, Merck & Co., Medtronic|
||Merck & Co., Medtronic, Cigna|
||Johnson & Johnson, UnitedHealth Group, Bristol-Myers Squibb|
About the fund: Kris Jenner was a top mutual fund manager for years, heading up T. Rowe Price's Health Sciences fund since 2000. That fund was the firm's top performer over his 13-year tenure, according to an analysis by Bloomberg. But last year he struck out on his own and raised $100 million for hedge fund Rock Springs Capital.
The strategy won't be dissimilar from Health Sciences, which has fared just fine so far under the hand of Taymour Tamaddon and is up 20% this year and is worth $10.2 billion. It's difficult to sort Rock Springs' performance from the new money that's likely continuing to flow in--Rock Springs hasn't reported on its fundraising to the SEC since it first did so on Oct. 15, 2013.
Intellectually, Jenner is certainly no slouch; he has an M.D. and a Ph.D. from Johns Hopkins University and Oxford University, respectively. He completed two years of a general surgery residency at Johns Hopkins.
Jenner is likely to have a more even hand and a larger cap focus than another fund manager who struck out on his own, also raising his own fund late last year: Alex Denner, the former biotech right-hand man to investing superstar Carl Icahn. Denner's strategy is to hold multiple, separate pools of money that each allow him to focus on a particular investing strategy; according to SEC filings from last year, Denner raised about $200 million in an offshore fund and $300 million in a domestic fund. Already, he's jumped in and raised an activist fuss at biotechs such as Ariad ($ARIA) and Vivus ($VVUS), like his mentor Icahn, who is rumored to be an investor in Denner's fund.
But given the additional tools at Jenner's disposal, such as shorting stocks to hedge his bets, it's likely that the influential Jenner will get his fund performance in hand shortly. But it remains to be seen if the time sitting on the sidelines during fundraising and ramping up--during a very hot market for biotech--will make it more difficult to find well-priced investments.
Show me the money: One of Jenner's largest positions at June 30 was in InterMune ($ITMN), worth $23.7 million. That stock is up 67% since then, making almost $16 million for the fund--assuming the number of shares didn't change prior to the August announcement by Roche ($RHHBY) of its $8.3 billion acquisition of the company.
Rock Springs had much smaller positions in a couple of stocks that have more than doubled this year: Intercept ($ICPT) and Avanir ($AVNR). And Gilead Sciences ($GILD), his largest position, has served as a cornerstone; it's up 28% this quarter and 41% on the year on ever-rising revenue projections for HCV treatment Sovaldi.
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