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Investing in Biotech's Best
Quaker Biotech Pharma-Healthcare Fund
Interview with: Michael Sjostrom

Author: Dave Jennings
Last Update: , :
Although the Quaker Biotech Pharma-Healthcare Fund opened in November, lead manager and sub-adviser Michael Sjöström has more than 10 years experience studying this diverse sector. The approach is both concentrated and flexible, and allows for selling short. Total return for the past six months is more than double the S&P 500.

Quaker Biotech Pharma-Healthcare Fund

A: What you want to make sure as an investor is the cash actually allows you to go to the next value creator or the next milestone for you, which for a drug development company, would be Phase Two results at the very least.

Q: Approximately how many drug candidates are currently in the pipeline?

A: I think that the number of drugs in late stage trials, or when a drug can be used as a pivotal trial, is 320 to 360.

Q: How does a research staff track that much? The reports you would have to read would take you essentially forever.

A: That would essentially kill our business. No, we don't. We take a more opportunistic approach, if I may say so. It’s a bottom up approach. To give you a sense of how we approach that side of things, the number of listed biotech companies, if you take a worldwide view, is about 600. The number of companies that we think are worthy of an investment from the long side would be about 150.

Q: How many are profitable?

A: We do have a handful, and that's probably being too conservative, of profitable biotech companies. The number will vary according to who you talk to and to how people tend to define profits. Our number is around 30 companies, and that includes the companies that are going to break even at any point during 2003. It is a worldwide number as well.

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