Bios scores big on 89bio, rotates to new opportunities
Healthcare
Bios Research’s long call on 89bio has paid off handsomely: since turning bullish in Apr 25, the shares have climbed ~120%, culminating in Roche’s announced takeover at $14.50/share plus a $6 CVR. With conviction now removed, Bios suggests rotating into SMID-cap biotech to capture what they see as the early stages of a new bull cycle. On the short side, the team has just launched a new idea with 30-50% expected downside over the next 6 months. Their track record is strong: 15 of 22 shorts over the past 18 months have generated absolute returns (~72% alpha-adjusted hit rate), with notable successful conviction removals including Apellis, Butterfly Network, Geron and Inspire Medical.
Edition: 221
- 03 October, 2025
Targeted shorts drive outperformance
Vision has initiated 5 new European short positions YTD across capital goods, autos, healthcare and consumer staples. The average market cap of these shorts exceeded $10bn, with the mean for average daily $ volume traded exceeding $35m. The team also closed 5 European shorts in 2025, generating alpha vs. the Stoxx 600 of 33%, 23%, 20%, 5% and 4% with an average holding period of ~13 months. On the US side, short ideas include Inspire Medical Systems, which is down ~40% this week after an 80% cut to FY25 EPS guidance.
Edition: 217
- 08 August, 2025
Inspire Medical Systems (INSP)
Healthcare
Tom Chanos turns bearish once again having successfully shorted the stock four times since Mar 21. Revenue growth has gone from +102% to +75% to +53% to +25% and is likely to be well under 20% in 2026. Maybe INSP can earn $1 per share by then. Those metrics would earn a P/E ratio of 50 at best, meaning this is a $50 stock three years from now (vs. $247 today)! Besides the ridiculous valuation, there are 20+ companies working on sleep apnea drugs. With INSP being a one product company, if any of those drug companies has a breakthrough, INSP would be in serious trouble. If the choice is a pill or a once per week injection vs. a $35k surgery, people will take the pill!
Edition: 185
- 03 May, 2024
Inspire Medical Systems (INSP)
Healthcare
Profitability keeps getting pushed out, which is a problem because growth is slowing and while INSP currently has a monopoly in its business, there is competition on the way. Tom Chanos notes that there are currently 20+ companies working on drugs for sleep apnoea; if any one of those companies breakthrough with a drug that is safe and works, INSP will be out of business overnight. By the time INSP can earn $1 per share, assuming it can, top line revenue growth will most likely be <20%. Why would anyone want to pay 240x earnings for a company that earns $1 growing at 18%?!
Edition: 157
- 31 March, 2023