Founder and Chief Investment Officer of Kerrisdale Capital Management LLC, Sahm Adrangi, is forecasting the flop of another drug in development. Coming on the heels of last year’s successful short selling attacks on drug makers Bavarian Nordic and Sage Therapeutics for their no better than placebo drugs Prostvac and brexanolone, investors are jumping on board to bet against Prothena’s proposed AL amyloidosis drug known only as NEOD001. Prothena’s shares dropped 8% after Sahm Adrangi shared his expert opinion.
While some may see Sahm Adrangi’s betting against the success of medications for potentially life-threatening illnesses morally questionable, Adrangi insists this isn’t the case. Essentially, Sahm Adrangi believes that the companies themselves knew that these medications were dead in the water but still continued to hype them and misrepresent testing data to gather investors’ excitement and cash.
For example, Bristol-Myers Squibb paid Bavarian Nordic $60 million to license their prostate cancer vaccine, Prostvac, already and was ready to pay an additional $80 million if the Phase III testing was successful. Sahm Adrangi brought his research on this company to the public in 2015, warning investors and patients that the science behind it was too generalized to work. 6 years after testing initialized, it was shown it didn’t have any more effect than a placebo. Their stocks dropped in value by half. See This Article for related information.
Adrangi was born in Iran and immigrated to the United States when he was five years old. His father, an engineer, later relocated his family from California to Vancouver. After earning a Bachelor’s of Arts in Economics from Yale University, he took a job as an analyst at Deutsche Bank in their leveraged finance group in April of 2004. From there he took another analyst position at Chanin Capital Partners in their bankruptcy restructuring group and then moved on to Longacre Fund Management LLC. where he worked with a distressed debt fund worth a staggering $2 billion.
The former editor and columnist for the Yale Daily News then founded the highly successful Kerrisdale Capital Management LLC. in April of 2009 where he has been for the last almost 10 years. Adrangi has spoken on his experience at the Sohn Conference, Traders 4 a Cause, and the Distressed Debt Conference among several others.