Investor enthusiasm for biotech stocks has helped billionaire Patrick Soon-Shiong’s investment partnership reap a $1.1 billion gain in less than eight months in shares of drugmaker NantKwest Inc.
The 63-year-old’s Cambridge Equities LP bought 31 percent of NantKwest for $47 million on Dec. 23, 2014, before its initial public offering last week, according to the company’s prospectus. Additional Cambridge purchases from other shareholders at an undisclosed price brought the partnership’s stake to 51 percent by the time of the offering.
With the shares at $28.96 at Thursday’s close, Cambridge has booked a ten-figure gain on its investment, according to data compiled by the Bloomberg Billionaires Index, which assumes all the shares were bought for the same price.
Soon-Shiong, a medical doctor and entrepreneur, is capitalizing on a booming biotechnology sector in the stock market, particularly in the area of immuno-oncology, in which drugmakers are trying to harness the immune system to combat cancer. NantKwest, of Cardiff-by-the-Sea, California, uses immune-system agents known as natural killer cells to combat the disease. The Nasdaq Biotechnology Index is up 22 percent in 2015, compared to the Standard & Poor’s 500 Index’s 1 percent gain.
No immediate response was received to e-mails seeking comment from NantKwest on Cambridge’s transactions.
In its stock-market debut, NantKwest’s shares priced above the expected range of $20 to $23 due to higher-than-expected demand. In all, NantKwest raised $207 million.
The biotech doesn’t have any approved treatments yet. It will soon start a mid-stage trial in Merkel cell carcinoma, a rare and aggressive form of skin cancer, according to spokeswoman Jen Hodson.
Soon-Shiong may also be planning an IPO for his health care information-technology firm NantHealth.
Allscripts Healthcare Solutions Inc. has bought a 10 percent equity stake in NantHealth for $200 million, valuing the company at $2 billion. Soon-Shiong told the Los Angeles Times in June that he anticipated NantHealth going public this year.