Article Excerpt:
TWST: Would you please begin with an overview of MPM Capital and the BioEquities Fund?Mr. von Emster: MPM was started in 1992 as a strategic advisor to the biotech commercial sector, primarily out of Boston where our headquarters was founded. Over the last six or so years we've been recognized as a leader in venture capital with now three funds under management and a little over $2 billion in venture capital dollars invested. Some of our LPs include large biotech companies like Biogen Idec as well as Merck and Novartis and other large pharmaceutical companies. I manage the MPM BioEquities Fund, which is our public investing arm of MPM Capital where we have about $250 million under management in a long-short investment structure primarily in the small/mid-cap publicly traded biotech space. In the MPM BioEquities Fund we also invest up to 15% of our assets in private late stage biotech companies usually with an eye for an IPO or a trade sale within about 16 to 24 months. Overall, the firm has about 24 investment professionals, 45 employees in total, offices in San Francisco, Boston, and New York. We pretty much can cover the entire world of biotechnology investing from Asia to Europe and everything in between.
TWST: What has happened to the biotech stocks from a market perspective
over this past 12 months?
Mr. von Emster: Biotech over the last 12 months has been relatively
volatile, to say the least. As a sector in 2005, it actually did
reasonably well, but predominantly only in the large cap sector; Amgen
(AMGN), Genentech (DNA), and so forth did extremely well. This sector
was up about 15% on a market-cap weighted basis. However, the average
biotech stock is down over the past year. There are about 400
biotechnology stocks of which only about 25 or so are profitable and
only a handful are over $1 billion in market cap. The majority of
biotech stocks that were $1 billion and below actually fell
precipitously last year and year to date are down. All the biotechs are
down at least through June 15 in the biotech sector anywhere from about
2% to 5% for the year, but the overall sector has had a relatively poor
experience over the last 12 months with performance I would say on an
average stock weighted basis down about 15% to 25%.
Tickers included in this excerpt: AFFX, ALKS, AMGN, AMLN, ARNA, CVTX, DNA, FVRL, GILD, HGSI, ICOS, IMCL, JNJ, LLY, NBIX, NKTR, NTMD, NVS, OSIP, PDLI, PFE, SEPR, SRA
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