A New York hedge fund specializing in medical-device and biotech plays has sold off 4.4 percent of its overall stake in NxStage Medical Inc.
Deerfield Management, which manages more than $1 billion in assets through its various investment partnerships, sold a total of 226,638 NxStage shares in recent days, pocketing just more than $1.5 million in gross proceeds. A Deerfield offshore vehicle, Special Situations Fund International, made roughly two-thirds of the trades, and a domestic special situations fund accounted for the balance, according to security ownership documents.
The dealing comes as stock in the Lawrence, Mass.-based portable dialysis equipment manufacturer is fetching some of its best prices in months. NxStage shares pushed past $7 each for the first time since February 2008 in mid-day trading Sept. 10, when Deerfield began selling, and has held above $6.40 during subsequent sessions. Through Sept. 16th’s close, NxStage stock is up 248 percent since bottoming out at $1.92 a share May 6.
Deerfield and its managing partner, James E. Flynn, have a penchant for buying NxStage on the cheap. Since the start of the year, Flynn purchased nearly 1.2 million of the company’s shares, with the bulk of the buying occurring during the first quarter while the stock was bouncing between $2.13 and $3.99 a share. Deerfield’s largest spree came last year during April, May and June, with Flynn doubling down amid a general selling spree after NxStage disappointed Wall Street despite meeting first-quarter revenue and net loss forecasts.
Overall, Deerfield currently owns 4.9 million NxStage shares, equal to about 10.5 percent of the company’s stock.
The fund, meanwhile, recently boosted its stake in NeuroMetrix, snapping up 2.5 million shares at $2 each as part of a $19 million private placement completed Sept. 11. Deerfield now owns nearly 4.4 million shares, or 19.9 percent, of Waltham, Mass.-based NeuroMetrix, which is developing nerve and spinal cord testing and treatment equipment.