Baupost Group Starts Kindred Biosciences Stake, Trims Enzon Pharmaceuticals Position ~ market folly

Monday, January 13, 2014

Baupost Group Starts Kindred Biosciences Stake, Trims Enzon Pharmaceuticals Position

Seth Klarman's investment firm Baupost Group has filed 2 separate 13G's with the SEC.

Discloses New Position in Kindred Biosciences (KIN)

Baupost has disclosed a brand new stake in Kindred Biosciences (KIN).  Per the SEC filing, the firm now owns 17.93% of the company with 2.9 million shares.  The filing was required due to portfolio activity on December 31st.  Shares of KIN just started trading in December.

Per Google Finance, Kindred Biosciences is "a development-stage biopharmaceutical company. The Company focused on pets. In addition, it has seven other product candidates, including several biologics, in various stages of development. The Company’s product candidates are CereKin for the treatment of osteoarthritis pain and inflammation in dogs, AtoKin for the treatment of atopic dermatitis in dogs, and SentiKin for the treatment of post-operative pain in dogs. All of these product candidates, if approved, would be first-in-class drugs in the pet therapeutic market. The Company’s product pipeline consists of small molecules and biologics in various stages of development for a range of indications in dogs, cats and horses. Small molecules are generally chemical compounds administered orally and biologics are generally proteins and vaccines administered by injection."

Trims Enzon Pharmaceuticals (ENZN) Stake

The hedge fund also filed an amended 13G on Enzon Pharmaceuticals (ENZN) and disclosed they've sold over 3.35 million shares recently.  The filing was required due to activity on December 31st.  After these sales, Baupost still owns 9.84% of ENZN with over 4.33 million shares.

Per Google Finance, Enzon Pharmaceuticals is "a biotechnology company. The Company’s drug development programs utilize two platforms: Customized PEGylation Linker Technology (Customized Linker Technology) and third-generation messenger ribonucleic acid (mRNA) antagonists utilizing the Locked Nucleic Acid (LNA) technology. The Company has four compounds in human clinical development, a PEGylated version of the active metabolite of the cancer drug, irinotecan, PEG-SN38, and mRNA antagonists Survivin and the Androgen Receptor (AR). In addition, it has mRNA antagonist targets in various stages of preclinical research. The Company receives royalty revenues from licensing arrangements with other companies related to sales of products developed using its Customized Linker Technology-PEGINTRON. It is also using LNA technology to develop mRNA antagonists against oncology targets."

While it's always interesting to monitor Baupost's equity activities, keep in mind that their long equity book is only a small portion of their large overall assets under management (AUM).  For more on this hedge fund, we've posted up some of Baupost's other portfolio activity here.

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