Are Impatient Investors Destroying Pharma R&D?
4/28/2014 6:23:37 AM
You’d be hard pressed to find a starker assessment of the current stage of biopharma than the viewpoint offered by William Ackman’s Pershing Square hedge fund, filed in support of their effort to partner with Valeant to acquire Allergan.
First, Ackman notes, as medium term (“our target holding period for our active investments is generally four to six years”) value investors, they’ve historically avoided pharmaceutical companies, preferring instead to invest in businesses with durable products (i.e. not affected by patent expirations) offering “predictable financial results” and “superior long-term growth in free cash flow per share.” Representative holdings they cite include P&G, Burger King, and Kraft.
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