This Fund Sold $49 Million of Cidara Stock — Then Merck Announced a $9.2 Billion Takeover
Key Points
California-based TCG Crossover Management sold 1 million shares of Cidara Therapeutics, cutting its stake by approximately $49 million in the third quarter.
The transaction value equaled about 2.4% of the fund’s 13F assets under management at quarter-end.
The move marked a full exit from Cidara Therapeutics, with TCG Crossover reporting no shares at the end of the period.
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California-based TCG Crossover Management fully exited its position in Cidara Therapeutics (NASDAQ:CDTX) during the third quarter, reducing its holdings by 1 million shares in a move valued at approximately $49 million as of Friday.
What Happened
According to a filing with the Securities and Exchange Commission released on Friday, TCG Crossover Management reported selling all its shares in Cidara Therapeutics (NASDAQ:CDTX). The liquidation of 1 million shares corresponded to an estimated transaction value of $49 million based on quarterly average pricing.
What Else to Know
This was a complete exit from Cidara Therapeutics, which previously accounted for 5.6% of TCG Crossover Management’s 13F assets.
Top holdings after the filing:
- NASDAQ:ABVX: $603.8 million (29.7% of AUM)
- NASDAQ:CGON: $147.8 million (7.3% of AUM)
- NASDAQ:COGT: $97.6 million (4.8% of AUM)
- NASDAQ:AMLX: $84.9 million (4.2% of AUM)
- NASDAQ:CNTA: $76.1 million (3.7% of AUM)
As of Monday, shares of Cidara Therapeutics were priced at $217.83, up a staggering 1,416% over the past year and far outperforming the S&P 500, which has gained nearly 15% in the same period.
Company Overview
| Metric | Value |
|---|---|
| Price (as of Monday) | $217.83 |
| Market Capitalization | $6.8 billion |
| Net Income (TTM) | ($184.7 million) |
| One-Year Price Change | 1,416% |
Company Snapshot
Cidara Therapeutics, Inc. is a biotechnology company specializing in the development of novel anti-infective therapies and oncology platforms. Leveraging proprietary technology and a focused pipeline, the company aims to address high-mortality infectious diseases and complex viral threats. More specifically, it develops long-acting anti-infectives, including rezafungin acetate for invasive fungal infections, and advances the Cloudbreak platform targeting viral diseases such as influenza, RSV, HIV, and COVID-19. Its strategic emphasis on differentiated, long-acting therapeutics positions it as a key innovator within the anti-infective and immunotherapy landscape.
Foolish Take
For long-term investors, the most important signal here is how a science-driven, "patient-capital" fund like TCGX adjusts positioning around clinical and valuation inflection points. The firm specializes in identifying transformative medicines early and supporting them over years—but it doesn’t typically trade around hype cycles. So a full exit from Cidara, previously a meaningful 5.6% position, suggests the fund believed its original risk-reward window had matured long before the market recognized the value of the firm's investigational, long-acting antiviral drug, CD388.
That makes the timing striking: Cidara’s stock has surged 1,416% over the past year, powered by Phase 3 momentum and $339 million in support from the Biomedical Advanced Research and Development Authority. Though much of that surge came after Merck agreed after quarter-end to acquire the company for $221.50 per share in cash—in a $9.2 billion deal—the stock was still up about 600% before the announcement. Meanwhile, Cidara’s third-quarter earnings reflect a late-stage biotech still deeply investing in its lead asset—net loss widened to $83.2 million (from $17.4 million last year), R&D more than doubled, and the company triggered a $45 million milestone payment tied to Phase 3 initiation. Cash now stands at $476.5 million, enough to fund completion of the program.
Within TCGX’s portfolio—dominated by biotechs like ABVX, CGON, and COGT—the exit likely reflects portfolio balance, not loss of faith in the science. After all, the company did just get a massive vote of confidence from one of the largest pharmaceutical firms worldwide.
Glossary
13F assets under management (AUM): The total value of securities a fund manager reports to the SEC on Form 13F.
Complete exit: When an investor sells all holdings of a particular security, leaving a zero position.
Liquidation: The process of selling off an investment position, often fully exiting a holding.
Quarterly average pricing: The average price of a security over a specific quarter, used to estimate transaction values.
Stake: The ownership interest or share an investor holds in a company or fund.
Anti-infectives: Drugs or therapies designed to prevent or treat infections caused by bacteria, viruses, or fungi.
Cloudbreak platform: Cidara Therapeutics' proprietary technology for developing treatments targeting viral diseases.
Clinical development: The stage in drug creation involving testing in humans to assess safety and effectiveness.
Commercialization: The process of bringing a new product or drug to market and making it available for sale.
Immunotherapy: Treatments that use or modify the immune system to fight diseases, including infections and cancer.
TTM: The 12-month period ending with the most recent quarterly report.
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Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Centessa Pharmaceuticals Plc. The Motley Fool has a disclosure policy.
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