Baker Bros Report

I’ve been tracking insider activity for years now. And over time, you start to get a feel for who really matters — whether it’s a CEO, a CFO, Warren Buffett, or even Nancy Pelosi with those political filings.

But out of everyone I follow, one hedge fund stands out above the rest.

I’m talking about Baker Bros.

I still remember one of my first conversations with Steve. He looked at me and said, “If you want to know who’s best in biotech, follow the Bakers.” So I started digging… and damn — he was right.

These guys are on another level.

Julian and Felix Baker have built their reputation by making concentrated bets, holding with long-term conviction, and spotting early-stage disruptors before anyone else.

From Seagen to the old BeiGene, they’ve nailed some of the biggest biotech winners of all time. 

And we’ve rode a lot of these names higher with them over the years. I think it’s time to do that again.

So this week, I revisited their top 10 holdings — and some of their highest-conviction investments are sporting great charts. Here’s the list:

At the top is BeOne Medicines $ONC — formerly known as BeiGene — which currently makes up over a quarter of Baker Bros’ portfolio.

They first bought it back in 2016, and it’s up a staggering 862% since.

Next up is Incyte $INCY, a core position they’ve held forever, now representing 20.3% of the portfolio.

Then comes Acadia Pharmaceuticals $ACAD, which they’ve held since 2005 — it's grown 250% since and makes up 7.8% of their AUM.

Among their small-cap picks, Kymera $KYMR stands out. The Bakers have steadily built their stake in it since 2020, and it now accounts for 3.3% of their portfolio.

And just this past Friday, they filed a fresh 13D on Celcuity $CELC, revealing an increasing ownership stake of 18.90%. It’s already returned 338% since their initial buy in late 2023.

Here’s an equal-weight index of these 10 names. Notice how they look a lot different from their peer group, breaking out to new all-time highs.

This isn’t something you’ll see from any other biotech indexes right now. Many of them are still trapped in wide, choppy trading ranges with no clear direction.

Meanwhile, Baker Bros hand-picks winners– innovative and disruptive biotechs that exhibit long-term relative strength and momentum– and it shows.

So, let’s take a look at what’s beneath the hood of these new highs and dive into the Baker Bros portfolio.

First up, we have BeOne Medicines $ONC, which Baker Bros owns an 8.15% stake in:

The stock is breaking out of a multi-year base within the context of an even larger base.

We like it long above 280 with a target at the prior cycle highs of 400.

Our second setup is Incyte Corp $INCY — a biotech firm with a solid track record in cancer and inflammation treatments, best known for its blockbuster drug Jakafi.

The stock is currently testing the anchored VWAP from its all-time highs near 78.

If buyers can reclaim that level, the path of least resistance shifts higher — with 154 as the next target.

Next is Acadia Pharmaceuticals $ACAD, which Baker Bros owns a whopping 26% ownership stake in.

Acadia is sitting flush against the 61.8% retracement after refusing to complete a nasty top earlier this year.

Above 23 and we like ACAD on the long side, targeting 37 with a secondary objective at 59.

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