Rayno Life Science Portfolio: Huge Year for Diagnostics and Tools Stocks

2012: Four Big Winners Up 30-40% in DX and Tools Portfolio: ABAX, EXAS, GPRO, ILMN

In a volatile year with dire macro news and low growth forecasts the NASDAQ was up 10 % YTD and the Rayno Life Science Portfolio had its best year since 2010. M&A continues to play a big role and over the past two years five of our portfolio companies have been acquired including GenProbe (GPRO) by Hologic (HOLX) this year but M&A is down 30% in H1 2012 according to GenomeWeb. A new M&A trend is the acquisition of Diagnostic companies by large more diversified Tools companies such as Agilent’s (A)  purchase of Dako for $2.2B, as they strive to add clinical content to their product mix.

Another underlying trend is personalized medicine and companion diagnostics and we are looking for smaller companies that are in the forefront of this trend. Currently in our portfolio Illumina (ILMN), Qiagen (QGEN) and Response Genetics (RGDX) have strategies within the Personalized Medicine theme.

We are left with only eleven companies in our portfolio so we need to look at new picks to reload. With the AACC Clinical Chemistry Conference next week we will be on the hunt for new ideas.

2012 Original Price Price % Price Price
Recomm Dec’10 Ret 7/1/11 7/13/12 %YTD
Abaxis ABAX 2/2/09 15 26.85 79 27.77 39.5 42.6
CardioV.Sys. CSII 11/5/10 7.15 11.66 63 15.45 10.55 5.4
Celera CRA 3/28/10 7 6.3 18 acquired
Exact Sci EXAS 12/10/10 5.6 5.98 6.8 8.48 11.45 40.5
GenProbe GPRO 2/2/09 45 58.35 29.7 69.79 82.55 39.6  acquired
Illumina ILMN 2/2/09 29 63.34 118 76 40.4 32.5
Immucor BLUD 4/5/10 20 19.83 0 20.73 acquired
Alere ALR 2/2/09 25 36.6 46 37.35 18.65 -19.2
MicroFluidics MFLU 7/6/10 0.77 1.34 74 acquired
NeoGen NEOG 7/2/10 26 41.03 58 45.33 44.6 45
Qiagen QGEN 3/15/10 21.5 19.55 -9 19.07 16.9 22.8
Quidel QDEL 6/16/10 12.4 14.45 16 15.3 16.75 11
Sequenom SQNM 11/18/09 3.75 8.03 114 7.44 3.88 -12.4
SeraCare SRLS 11/18/09 2.75 4.75 73 3.77 acquired
ResponseG RGDX  2/3/12  1.50  new  1.30  (13)

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