If you’re interested in biotechnology stocks, billionaires Julian and Felix Baker are the ones to turn to. 

According to Forbes, the brothers, each worth an estimated $2.8 billion, run Baker Bros. Advisors, a hedge fund they started in 2000. The fund now manages nearly $22 billion, all invested in biotech stocks.  

The hedge fund’s Q4 2024 13F holdings report showed $9.36 billion in assets invested in 95 securities, including two fixed-income Investments. While the firm made 41 moves during the fourth quarter, few were consequential. 

Baker Bros. purchased nine new stocks, added to 20 more, sold out of seven, and reduced its holdings in five others. As I mentioned, few, if any of the moves are notable. 

However, one move stood out among the 41: Beigene (NASDAQ:ONC). I’ll discuss it below. Meanwhile, a couple of other changes are worth mentioning. 

Here’s why. 

Key Points About This Article:

• The Billionaire Baker brothers made over 40 moves in the fourth quarter. 
• Despite promising news from the FDA, the hedge fund dumped 80% of its holdings in the French biopharmaceutical firm.
• Although it acquired a prominent position in Candel Therapeutics (NASDAQ:CADL), the biggest news came from Beigene (NASDAQ:ONC), one of its most significant investment successes. 
• If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report. It features a software stock we’re confident has 10X potential.

If You Invest in Biotech, You’re Going to Have Losers

In the fourth quarter, the hedge fund sold 5.85 million shares of DBV Technologies (NASDAQ:DBVT), a French biopharmaceutical firm specializing in the research and development of epicutaneous immunotherapy products. 

Viaskin Peanut is the firm’s leading immunotherapy product. It has completed Phase III clinical trials for the product to treat peanut allergy patients. 

Completing Phase III trials should be beneficial for biotech firms focused on commercialization. Yet, the company’s stock has fallen 51% over the past 12 months. 

In mid-December, the company issued a press release that it had reached a path forward with the FDA (Food and Drug Administration) for the regulatory approval of its Viaskin Peanut patch for kids 1-3 years old. 

“DBV is pleased to have received, what we believe to be, a clear and reasonable pathway towards an Accelerated Approval for the Viaskin Peanut patch in toddlers 1 – 3-years-old. This comes on the heels of our October 22nd press release announcing details in support of our separate Viaskin Peanut programs in 4 – 7 year-olds and in 1 – 7 year-olds in Europe,” said Daniel Tassé, Chief Executive Officer, DBV Technologies. 

This news has resuscitated DBVT stock somewhat in 2025, as it’s up 33%. 

So, why did Baker Bros. cut its stake by 80% in the fourth quarter, which would have generated approximately $19 million in proceeds from the sale? According to WhaleWisdom.com, the hedge fund paid an average $34.90 for DBVT stock, 10 times higher than its current share price. 

It first bought shares in the biotech in Q4 2014. It was time to cut losses. It still holds 1.46 million shares and remains the 71st-largest position in the hedge fund’s portfolio. 

It Now Owns 9.2% of Cancer Immunotherapies Developer

One of Baker Bros.’s nine new purchases in the quarter was Candel Therapeutics (NASDAQ:CADL), a Boston-based firm specializing in developing immunotherapies for cancer patients. 

The hedge fund acquired 2.98 million shares in the company. That made it the 38th-largest position, accounting for 0.28% of its portfolio. More importantly, it now owns 9.2% of the biotech firm. 

Although Baker Bros. made a more significant dollar purchase with Grail (NASDAQ:GRAL), a company developing products for early cancer detection, the nearly 10% stake in Candel stands out. 

Candel has recently attracted some positive ratings from Wall Street. 

For example, on Feb. 19, Canaccord initiated coverage of the firm with a Buy rating and a $20 price target, nearly double its current price. 

“The firm expects continued clinical success for lead asset CAN-2409 in prostate, pancreatic, and non-small cell lung cancer, the analyst tells investors. In testing so far, CAN-2409 has demonstrated a significant increase in median overall survival and if this trend continues, CAN-2409 ‘could serve as a best-in-class therapy for borderline resectable pancreatic ductal adenocarcinoma,’” The Fly reported.

Around the same time, Citigroup initiated coverage with a Buy rating and a $25 price target, significantly higher than today.

Sometimes, it’s hard to know why hedge funds buy stocks. With Candel, it is widely praised by Wall Street and professional hedge fund investors like Baker Bros.

The Bakers Trim Their Second-Largest Holding

In the fourth quarter, the hedge fund sold 1.04 million shares of Beigene, a 9.81% reduction in its holdings in the developer of cancer products from discovery to commercialization. 

WhaleWisdom.com said the hedge fund first owned ONC stock in Q1 2016. It’s estimated to have paid $131.42 per share for the stock. Despite the sale of shares, it still owns 9.53 million, making it Baker Bros.’ second-largest holding.

Many biotech firms trading on Nasdaq don’t have revenues. Beigene does. 

In the quarter ended Sept. 30, 2024, it generated $1.0 billion in revenue, up 28% from $781.3 million a year earlier. Its leading commercial product is Brukinsa, which treats relapsed/refractory (R/R) mantle cell lymphoma. Its U.S. accounted for 51% of Beigene’s product revenue in the third quarter—International Brukinsa sales another 19% overall. 

Due to the strong quarter, it generated adjusted income from operations of $65.6 million, a 502% increase from Q3 2023’s $16.3 million loss. 

A significant pipeline of drugs in development for hematology, lung cancer, breast and gynecologic cancer, and gastrointestinal cancer, combined with growing Burkinsa sales, suggests that a GAAP profit could be in the works for 2025. 

Of the 33 analysts covering Beigene, 30 rate it a Buy (91%). It doesn’t get much better than that. 

ONC stock lost altitude in the fourth quarter, prompting the Bakers to take some profits. However, it regained its mojo in 2025, up 40% year-to-date. The best looks are yet to come.

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