|If you can’t find any good long/short opportunities, you can just create them; which is what hedge fund manager Kyle Bass is doing in the pharmaceutical industry. As reported in the Wall Street Journal, the high profile head of Hayman Capital Management, seeks to create his shorting opportunities by killing vulnerable drug patents of pharmaceutical companies, while opening long positions on rival drug companies that would benefit.|
While Hayman Capital is targeting Pharma companies with its new strategy, the firm’s commitment to the sector overall is not enough to position it on The Top Healthcare, Pharma & Biotech Hedge Fund List.
Operating under an organization Kyle Bass created – the Coalition for Affordable Drugs – Kyle Bass identifies and challenges patents he deems to be specious and that are likely candidates to be invalidated by a patent office panel known as Inter Partes Review. Although Kyle Bass insists his strategy has consumer interests at heart (to keep drug prices down), his critics and the CEO’s of targeted companies, such as Jazz Pharmaceuticals and Acorda Therapeutics accuse him of exploiting a highly accessible patent review process simply for profit. Investors can ride along with the strategy for a $1 million investment.