Baker Brothers Makes $730 Million in One Day on Its Biotech Bet

(Bloomberg) -- As Seattle Genetics Inc. rallies on a successful breast cancer study Monday, the biotech’s largest holder, Baker Bros. Advisors LP, stands to gain nearly $730 million on the day from its stake.

The investment firm founded by Felix and Julian Baker made a big bet in the company, their biggest in fact, with a 29% stake, as of June 30, according to data compiled by Bloomberg. That stake is worth roughly $5 billion today after tucatinib -- an experimental therapy Seattle Genetics acquired for more than $400 million last year -- surprised investors by slowing the spread cancer and extending patients’ lives. Even more surprisingly, it had an effect on patients whose cancer had spread to their brains.

Baker Brothers Makes $730 Million in One Day on Its Biotech Bet

Baker Bros. has been invested in the company for over 15 years, and Felix Baker is a lead director for the biotech. Today Seattle Genetics makes up over 28% of Baker Bros.’s $15.5 billion in assets.

The stock rose as much as 17% to a record high of $101.95 intraday. Twelve analysts that follow the company rate it the equivalent of a buy, five rate it a hold and one rates it a sell. With an average price target of $87, some analyst target raises are likely in the near future.

©2019 Bloomberg L.P.

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