U.K. fund manager Neil Woodford bets big on AstraZeneca

Neil Woodford

Plenty of AstraZeneca ($AZN) fans voiced their support for a standalone company when Pfizer ($PFE) tried to take the drugmaker over earlier this year. But actions speak louder than words, and now one vocal advocate is putting his money where his mouth is.

Well-known British hedge fund manager Neil Woodford has picked AZ as the largest holding in his newly launched fund, Equity Income, the Financial Times reports. The pharma makes up 8.3% of the fund, which picked up £1.6 billion during its offer period.

Woodford, who has held a major stake in AstraZeneca for many years, stood behind a solo AZ through Pfizer's failed attempts to orchestrate a £55-per-share buyout, touting the company's science and leadership.

"A cashing-out exercise is no use to me--there isn't another AstraZeneca out there. There is nothing I want to invest in," he told The Telegraph in May.

But the pharma industry's resilience also factored into Woodford's choice, he told the FT, highlighting the sector's resistance to falling demand, strong balance sheet and attractive valuation. Equity Income also boasts a 7.1% holding in AZ's London-based neighbor GlaxoSmithKline ($GSK).

"I have been very careful in building a portfolio that avoids sectors I believe are vulnerable to a faltering global economy," Woodford said.

AstraZeneca CEO Pascal Soriot

Woodford isn't the only one to invest in an independent AZ now that much of the merger drama has subsided. Amid a string of lofty sales projections, AstraZeneca CEO Pascal Soriot last week put down £2 million ($3.4 million) to buy up more of his company's shares.

But that doesn't mean the deal is necessarily dead forever. As BNP analysts wrote in a research report last month, AstraZeneca can resume talks with Pfizer as early as August, with Pfizer allowed to make a new bid starting in November. An amped-up offer equaling about £75 billion pounds--about $127.7 billion--would still make "economic sense," they said.

- read the FT story (sub. req.)
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Special Report: Top 10 pharma companies by 2013 revenue - AstraZeneca

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