PGIM Jennison Health Sciences Fund recently released its third quarter 2024 investor letter. A copy of the letter can be downloaded here. Given concerns regarding the decreasing pace of U.S. employment and the associated concerns that U.S. interest rates may have been maintained at levels higher than necessary to moderate the pace of inflation, U.S. equity markets fluctuated during the summer and partially reversed their year-to-date gains. The S&P 1500 Health Care Index appreciated 6.1% in the third quarter, outperforming the S&P 500, which gained 5.9%. While the fund advanced in the quarter, it underperformed the index. Stock selection within medtech and pharmaceuticals contributed to the most value. Relative performance was negatively impacted by security selection in biotechnology and health care providers and services, as well as underweights in life sciences tools and services. In addition, please check the fund’s top five holdings to know its best picks in 2024.
PGIM Jennison Health Sciences Fund highlighted stocks like Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT), in the third quarter 2024 investor letter. Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) is a biopharmaceutical company that focuses on developing and commercializing treatments for gastrointestinal diseases. The one-month return of Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) was -7.65%, and its shares lost 5.99% of their value over the last 52 weeks. On December 11, 2024, Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) stock closed at $8.40 per share with a market capitalization of $574.028 million.
PGIM Jennison Health Sciences Fund stated the following regarding Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) in its Q3 2024 investor letter:
“Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) is a commercial stage biopharmaceutical company that markets vonoprazan under the brand name Voquezna, an oral once a day pill for GERD. The drug was approved for erosive GERD in November 2023 and recently received approval for non-erosive GERD. This is the first new mechanism for GERD in 30+ years and the company aims to capture the patients that are not sufficiently addressed with proton pump inhibitors (PPIs). This was a name that had fallen off investors radars because the company had pre-approval manufacturing issues and they are launching into a genericized market. However, these manufacturing issues were resolved before the drug launched and our early physician work indicated a high unmet need and a strong desire to prescribe despite the availability of generics PPIs. The Voquenza launch has been strengthened in recent months driven by the robust and rapid commercial payer coverage, Food and Drug Administration (FDA) approval of a second indication for a larger patient population (non-erosive GERD (NERD)), and positive patient and physician experiences with the drug. We believe we are in the early innings of the launch and that current consensus is not reflective of the ultimate potential off the drug.”
A scientist in a laboratory smiling with a test tube in hand, representing the company’s research in biotechnology.
Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 20 hedge fund portfolios held Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) at the end of the third quarter which was 16 in the previous quarter. While we acknowledge the potential of Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Phathom Pharmaceuticals, Inc. (NASDAQ:PHAT) and shared the list of most shorted stocks in 2024. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.