| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 13.6% | -7.2% | -7.2% |
Arquitos returned -7.2% net in Q1 2026 but manager Steven Kiel remains focused on special situation opportunities in biotechnology and pharmaceuticals. The fund's core theme involves liquidating biotech companies that failed clinical trials but trade below net cash value, creating mispricings when biotech-focused shareholders sell indiscriminately. Key holdings include ENDI Corp with strong fundamental performance, Finch Therapeutics undergoing strategic Chapter 11 sale with expected resolution in June, and Liquidia Corporation where Kiel expresses his highest conviction ever. Liquidia's Yutrepia product launch has been outstanding, with pending patent litigation decision that could drive shares to $70-140 range regardless of outcome. The manager sees $1.2 billion revenue potential by 2027 with 60% margins. Finch's patent award against Ferring Pharmaceuticals valued at $25-80 per share awaits judge's decision after 20 months. Kiel actively seeks more liquidating biotech opportunities and considers taking activist roles in appropriate situations.
Arquitos focuses on special situation investments in small-cap companies, particularly liquidating biotechs trading below net asset value and pharmaceutical companies with significant patent-driven value catalysts.
Manager expects resolution of key catalysts in the coming months, including Finch's sale process in June and Liquidia's patent decision imminently. Continues to see opportunities in liquidating biotech situations and remains highly bullish on Liquidia's prospects regardless of patent outcome.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 30 2026 | 2026 Q1 | ENDI, FNCH, LQDA | activism, Biotechnology, liquidation, Patent litigation, SmallCap, special situations, value |
ENDI FNCH LQDA |
Arquitos targets liquidating biotechs trading below cash value and patent-driven pharmaceutical plays. Manager most bullish ever on Liquidia Corporation, expecting $70-140 per share regardless of pending patent decision. Finch Therapeutics strategic sale expected June with healthy premium. Actively buying more biotech liquidation situations while awaiting multiple near-term catalysts. |
| Jan 22 2026 | 2025 Q4 | ENDI, FNCH, LQDA, MRK, UTHR | Biotechnology, Concentration, Patents, SmallCap, special situations, value |
LQDA ENDI FNCH |
Arquitos delivered 82.1% returns in 2025 through concentrated biotech special situations. Liquidia's successful drug launch captured 25% market share while ENDI and Finch advanced operationally and legally. Manager maintains high conviction in current holdings, viewing them as still undervalued despite strong performance, with multiple catalysts ahead including potential M&A activity. |
| Oct 20 2025 | 2025 Q3 | ENDI, FNCH, LQDA | Biotechnology, FDA, Litigation, Patents, small caps, special situations, value |
LQDA ENDI FNCH |
Arquitos delivered 66.8% YTD returns through concentrated small-cap biotech investments. Liquidia's FDA-approved Yutrepia launched exceptionally, ENDI trades at 4x EBITDA despite strong asset management growth, and Finch awaits enhanced damages ruling. Manager believes small caps will outperform large caps over the coming decade and maintains conviction in significantly undervalued core holdings. |
| Jul 24 2025 | 2025 Q2 | ENDI, LQDA | Biotechnology, FDA approval, Patent Disputes, small caps, Specialty Finance, value |
LQDA ENDI LQDA ENDI |
Arquitos gained 13.1% in Q2 2025 as uncertainty created opportunities in core holdings. Liquidia's FDA-approved Yutrepia launched with strong prescription numbers despite temporary stock volatility. ENDI trades below fair value relative to its growing CrossingBridge subsidiary. Manager emphasizes that short-term narratives often obscure long-term business fundamentals, creating attractive entry points for patient investors. |
| Jan 26 2025 | 2024 Q4 | ENDI, FNCH, LQDA, MSTR, NTPIF, UTHR | Biotechnology, concentrated, FDA approval, Patent litigation, Pharmaceuticals, small caps | - | Arquitos outperformed in 2024 and manager expresses highest confidence ever in 2025 prospects. Concentrated small-cap portfolio focused on biotech catalysts including Finch's patent litigation upside and Liquidia's May FDA approval for superior inhaler technology. Nam Tai resolved governance issues while ENDI remains largest conviction holding. |
| Oct 20 2024 | 2024 Q3 | ENDI, LFCR, LQDA | Biotechnology, FDA, Patent litigation, small caps, value |
ENDI LQDA LFCR |
Arquitos focuses on small-cap value with significant upside catalysts. New patent litigation position offers 2-6x upside potential from court awards. ENDI asset manager doubled AUM to $3.2 billion. Liquidia's superior PAH drug delayed until May 2025 but positioned for major market share gains. Portfolio volatility reflects concentrated small-cap approach with strong conviction in undervalued opportunities. |
| Jan 18 2024 | 2023 Q4 | ENDI, LFCR, LQDA, MNKD, NTP, UTHR, VTY.L | activism, Biotechnology, Buybacks, Homebuilders, Skin in Game, small caps, value |
LQDA VTY.L LFCR ENDP NTP |
Concentrated small-cap value fund returned 22.1% in 2023 through investments in companies with significant management ownership. Top holdings include Liquidia (patent win, April product launch), Vistry (£1B buyback program), and three potential sale candidates. Manager prioritizes skin in the game as key investment criterion for alignment and insight. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
BiotechnologyManager discusses liquidating biotech and biopharma companies as a special situation theme, focusing on pre-revenue biotechs with failed phase 3 trials that trade below net cash value. These situations create mispricings when biotech-focused shareholders sell indiscriminately after clinical failures, leaving companies with excess cash and tax loss carryforwards. |
Liquidation Special Situations Clinical Trials Tax Assets Activism |
PharmaceuticalsThe fund holds positions in pharmaceutical companies including Liquidia Corporation with their Yutrepia product launch and patent litigation with United Therapeutics. Manager expects significant revenue growth potential in the treprostinil market, with Liquidia positioned to capture majority market share and expand the addressable market. |
Patent Litigation Product Launch Market Share Revenue Growth Royalties | |
| 2025 Q4 |
AfricaFund delivered exceptional performance with 67.21% returns in 2025, significantly outperforming the 44.7% benchmark. Portfolio companies show strong fundamentals with forward PE of 6.1x, dividend yield of 8.0%, and expected EPS growth of 19.2%. Manager emphasizes this represents genuine earnings growth rather than multiple expansion. |
Frontier Markets Emerging Markets Equities Value Growth |
LiquidityManager addresses investor concerns about African frontier market liquidity, explaining structural factors affecting trading volumes. Notes that foreign investor participation, local retail and institutional involvement all impact liquidity. Observes recent improvements in Nigeria and Kenya trading volumes from low bases. |
Market Structure Trading Volumes Institutional Foreign Investment | |
ValuePortfolio trades at attractive valuations with forward PE of 6.1x and forward dividend yield of 8.0%. Manager emphasizes no valuation multiple expansion over 5+ years, with share price appreciation driven by earnings growth. Forward price-to-book ratio of 1.5x and ROE of 25.1% demonstrate quality businesses at reasonable prices. |
Valuation Earnings Dividends Quality Fundamentals | |
| 2025 Q3 |
BiotechnologyPortfolio heavily concentrated in biotech companies with significant patent litigation and FDA approval catalysts. Liquidia received FDA approval for Yutrepia and launched successfully, while Finch won patent infringement case against Ferring with potential for enhanced damages. |
FDA Patents Litigation Commercialization Royalties |
Small CapsManager explicitly positions fund as small-cap allocation and adopts Russell 2000 as primary benchmark. Believes small caps will outperform large caps over coming decade, reversing recent trend where large caps significantly outperformed. |
Russell 2000 Outperformance Valuation Benchmark Allocation | |
| 2025 Q2 |
BiotechnologyLiquidia Therapeutics represents a significant biotech investment focused on Yutrepia, a treprostinil inhaler for PAH treatment. The drug received FDA approval in May 2025 and launched with strong initial prescription numbers exceeding expectations. The company faces ongoing patent disputes with United Therapeutics and potential future competition from Insmed's once-daily treatment, though that competitor is years away from market entry. |
FDA Approval PAH Treatment Patent Disputes Drug Launch Treprostinil |
Specialty FinanceENDI Corp owns 75% of CrossingBridge subsidiary, an asset management firm with $4 billion in AUM that has grown substantially from $3.4 billion at year start. The market is significantly undervaluing ENDI's stake in CrossingBridge relative to a recent third-party transaction that valued the subsidiary at $104 million when AUM was 15% lower. |
Asset Management AUM Growth Valuation Discount Subsidiary Sale | |
| 2024 Q4 |
BiotechnologyTwo major biotech positions dominate the portfolio. Finch Therapeutics won a patent infringement case against Ferring with potential for enhanced damages up to 3x the $30M jury award. Liquidia Therapeutics awaits FDA approval in May 2025 for its inhaler product Yutrepia, which could capture 80-90% market share due to superior delivery technology. |
Patent litigation FDA approval Drug delivery Market share Clinical trials |
PharmaceuticalsFocus on treprostinil delivery systems for treating PAH and PH-ILD. Liquidia's PRINT technology creates smaller, uniform particles enabling deeper lung penetration and equivalent of 33 breaths per session versus competitors' 9-12 breaths. The addressable market includes 100,000 PAH patients and 60,000 PH-ILD patients with current revenue run rate of $1.7 billion annually. |
Treprostinil PAH treatment PH-ILD Drug delivery Market opportunity | |
| 2024 Q3 |
BiotechnologyLiquidia continues to face FDA delays for their PAH and PH-ILD drug Yutrepia until May 2025, despite having a superior product with better patient tolerance. The manager believes Liquidia can capture 50% market share given the 50-60% dropout rate for the competitor's drug. |
FDA Drug Approval PAH PH-ILD Market Share |
| 2023 Q4 |
BiotechnologyLiquidia won patent litigation against United Therapeutics for PAH treatment, with CEO making $1M share purchase before decision. Product expected to launch April 2024 with potential to capture significant market share from United Therapeutics through superior delivery technology. |
PAH Patent Litigation Yutrepia |
HomebuildersVistry transitioning from traditional homebuilding to asset-light partnerships model, enabling £1 billion buyback program over three years. Management committed to strategy with CEO owning £10M+ shares including £5M purchase after merger. |
Partnerships Asset Light Transition | |
CRO & CDMOLifecore is pure-play CDMO specializing in hyaluronic acid and pre-fill injectables with expanded manufacturing capabilities. Company undergoing sale process despite audit complications from divested food subsidiary. |
Hyaluronic Acid Manufacturing Sale Process |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 30, 2026 | Fund Letters | Arquitos Capital Management | ENDI | ENDI Corp. | Asset Management | Asset Management & Custody Banks | Bull | NASDAQ | asset management, AUM growth, cash position, EBITDA, financials, Revenue Growth | Login |
| Apr 30, 2026 | Fund Letters | Arquitos Capital Management | FNCH | Finch Therapeutics | Biotechnology | Biotechnology | Bull | NASDAQ | asset monetization, biotechnology, Chapter 11, IP Portfolio, Liquidation, Patent Litigation, Special Situation | Login |
| Apr 30, 2026 | Fund Letters | Arquitos Capital Management | LQDA | Liquidia Corporation | Drug Manufacturers - Specialty & Generic | Pharmaceuticals | Bull | NASDAQ | market share, Pah, Patent Litigation, PH-ILD, pharmaceuticals, Revenue Growth, Treprostinil, Yutrepia | Login |
| Jan 22, 2026 | Fund Letters | Steven L. Kiel | FNCH | Finch Therapeutics Group, Inc. | Health Care | Biotechnology | Bull | NASDAQ | Biotech, Legal, litigation, patents, royalties | Login |
| Jan 22, 2026 | Fund Letters | Steven L. Kiel | LQDA | Liquidia Corporation | Health Care | Biotechnology | Bull | NASDAQ | Biotech, cashflow, Druglaunch, patents, Pulmonary | Login |
| Jan 22, 2026 | Fund Letters | Steven L. Kiel | ENDI | ENDI Corp. | Financials | Asset Management | Bull | NASDAQ | Assetmanagement, AUM, EBITDA, rerating, valuation | Login |
| Oct 20, 2025 | Fund Letters | Steven L. Kiel | LQDA | Liquidia Corporation | Health Care | Biotechnology | Bull | NASDAQ | Adoption, Catalysts, FDA approval, IP risk, M&A, Prescriptions, rare disease | Login |
| Oct 20, 2025 | Fund Letters | Steven L. Kiel | ENDI | ENDI Corp | Financials | Asset Management | Bull | Dubai Financial Market | AUM, capital allocation, downside protection, EBITDA, Holdco, Liquidity, undervaluation | Login |
| Oct 20, 2025 | Fund Letters | Steven L. Kiel | FNCH | Finch Therapeutics Group, Inc. | Health Care | Biotechnology | Bull | Dubai Financial Market | Asymmetry, Catalyst, damages, litigation, royalties, Timing, Willful-infringement | Login |
| Jul 24, 2025 | Fund Letters | Arquitos Capital Management | LQDA | Liquidia Therapeutics | Health Care | Biotechnology | Bull | NASDAQ | biotechnology, Commercial Rollout, competitive moat, FDA approval, Inhaled Therapeutics, Monopolistic Market, PAH Therapy, Patent Disputes, Prescription Growth, product launch | Login |
| Jul 24, 2025 | Fund Letters | Steven L. Kiel | LQDA | Liquidia Corporation | Health Care | Biotechnology | Bull | NASDAQ | Biotech, Commercialization, growth, Prescriptions, Trials, valuation | Login |
| Jul 24, 2025 | Fund Letters | Steven L. Kiel | ENDI | ENDI Corp. | Financials | Asset Management | Bull | Dubai Financial Market | Assetmanagement, AUM, cashflow, discount, growth, valuation | Login |
| Jul 24, 2025 | Fund Letters | Arquitos Capital Management | ENDI | ENDI Corp | Financials | Asset Management & Custody Banks | Bull | OTC | asset management, AUM growth, CrossingBridge, fee income, Operational Performance, Sum-of-Parts Valuation, Third-Party Transaction, undervaluation, Value Disconnect | Login |
| Oct 20, 2024 | Fund Letters | Arquitos Capital Management | ENDI | ENDI Corp. | Financials | Asset Management & Custody Banks | Bull | NASDAQ | asset management, AUM growth, Bull, fixed income, Mutual Funds, Nordic Markets | Login |
| Oct 20, 2024 | Fund Letters | Arquitos Capital Management | LQDA | Liquidia | Health Care | Biotechnology | Bull | NASDAQ | biotechnology, Bull, FDA approval, market share, PAH Treatment, patent protection, PH-ILD, Regulatory Delay | Login |
| Oct 20, 2024 | Fund Letters | Arquitos Capital Management | LFCR | Lifecore | Health Care | Life Sciences Tools & Services | Neutral | NASDAQ | activist investor, capacity expansion, CDMO, contract manufacturing, Fill-Finish, Neutral, turnaround, weight-loss drugs | Login |
| Jan 18, 2024 | Fund Letters | Arquitos Capital Management | LQDA | Liquidia Corporation | Health Care | Biotechnology | Bull | NASDAQ | biotechnology, Clinical trials, drug delivery, Inhaler, market share, Patent Litigation, Pharmaceutical, Pulmonary hypertension | Login |
| Jan 18, 2024 | Fund Letters | Arquitos Capital Management | VTY.L | Vistry Group PLC | Consumer Discretionary | Homebuilding | Bull | London Stock Exchange | asset-light, homebuilding, Partnerships model, Real Estate, Share Buybacks, turnaround, UK, Value | Login |
| Jan 18, 2024 | Fund Letters | Arquitos Capital Management | LFCR | Lifecore Biomedical Inc | Health Care | Life Sciences Tools & Services | Bull | NASDAQ | activist, Biotech Services, CDMO, Hyaluronic Acid, Injectables, sale process, Special Situation, Supply Constrained | Login |
| Jan 18, 2024 | Fund Letters | Arquitos Capital Management | ENDP | Endo International plc | Health Care | Pharmaceuticals | Bull | NASDAQ | Operational Performance, small-cap, Specialty pharmaceuticals, Underfollowed, undervalued, Value | Login |
| Jan 18, 2024 | Fund Letters | Arquitos Capital Management | NTP | Nam Tai Property Inc | Real Estate | Real Estate Management & Development | Bull | NYSE | activist, China, Corporate Governance, Litigation Recovery, Real Estate, sale process, Special Situation, turnaround | Login |
| TICKER | COMMENTARY |
|---|---|
| ENDI | ENDI shares declined from $16.75 at the end of 2025 to $15.00 at the end of the first quarter. In March, the company reported strong results for full year 2025. Assets Under Management increased by 21% to $4.1 billion at the end of 2025 compared to the end of 2024. Overall revenue increased by 38% to $21.3 million. Adjusted EBITDA increased to $11.1 million from $6.5 million compared to the year before. ENDI ended 2025 with $53 million of total cash and investments compared to $20.1 million at the end of 2024. |
| FNCH | Finch shares declined from $13.49 at the end of 2025 to $9.64 at the end of the first quarter. They are lower today. Don't let this declining price fool you. As I will explain below, no actual value within the company has declined. Consistent with the liquidating biotech and biopharma theme, Finch is one of the rare companies that is doing the economically rational thing. As I have mentioned in previous letters, they won a jury trial in August 2024 against Ferring Pharmaceuticals, with the jury finding that Ferring infringed on three of Finch's patents. The value of that award to Finch is between $25 and $80 per share depending on the post-trial decision from the judge. Because of this, the company decided to move forward with a strategic Chapter 11 filing in order to eliminate the lease obligation and organize an outright sale of the entire company. The company has disclosed that there has been healthy interest from potential buyers. We should have a resolution in early June. I believe that this process will maximize the value of Finch for shareholders and will monetize the assets more effectively than if Finch remained a publicly traded company. While the ultimate sale price won't be known until June, I continue to believe that we will get a healthy premium over our purchase price. |
| LQDA | Liquidia shares increased from $34.49 at the end of 2025 to $37.74 at the end of the first quarter. I have written extensively about our investment in Liquidia. The launch of their Yutrepia product has been nothing short of outstanding. We will be receiving a company update in the next few weeks and expectations continue to be high. If Liquidia wins outright with no infringement found, Liquidia should be able to produce $1.2 billion in revenue in 2027 with net margins of at least 60%. If we apply the current market multiple of their competitor, United Therapeutics, then Liquidia shares are worth at least $140 per share fully diluted. If Liquidia is found to have infringed on the United Therapeutics patent, the likely outcome is for the court to impose a royalty on Yutrepia sales involving PH-ILD with a royalty range between 3% and 10%. Assuming PH-ILD-related Yutrepia sales are 70% of overall 2027 sales of $1.2 billion, and assuming the worst-case scenario of a 10% royalty, Liquidia shares are worth approximately $123 per share fully diluted. In the worst-case scenario, the judge could find that Liquidia infringed on the United Therapeutics patent and issue a permanent injunction on the sale of Yutrepia to PH-ILD patients. I believe this potential outcome has less than a 5% chance of happening. However, if it does happen and there are no sales to PH-ILD patients in 2027, Liquidia shares would still be worth $70 per share in 2027 on sales to PAH patients alone. I have never been this bullish on a position we have held in the fund. |
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