EcoR1 Thinks The Setup In The Sector Is “Beautiful”

Many companies in the biotech sector look deeply undervalued and under-appreciated, a “beautiful” setup, according to the specialist biotech hedge fund EcoR1 Capital.

In its first-quarter update to investors, the fund argues that at the beginning of 2021, most biotechnology investors believed the process of drug discovery and development had become permanently easier.

According to the firm's analysis, the market dispelled this fantasy in the second half of the year, and many investors are now convinced that the sector will remain depressed for at least the next 12 months.

Q1 2022 hedge fund letters, conferences and more

This has created the perfect environment for the specialist hedge fund, which believes there is little to no upside priced into biotech valuations, offering...