Our Method

Our process is built on rigorous, bottom-up fundamental research and deep scientific expertise. By organizing coverage around therapeutic areas rather than sub-sectors, we seek to identify first-in-class innovations early and invest with the discipline and conviction to see them through.

Investment Process

A rigorous methodology built on science, discipline, and collaboration.

Our process leverages the full resources of the firm – combining deep scientific expertise, fundamental research and iterative analysis – as we strive to produce the best outcomes for our investors.

Step 1 of 5

Multi-Disciplinary Research

We apply scientific, clinical, medical, and industry experience to evaluate investment opportunities. Our research incorporates fundamental analysis and industry relationships, with careful attention to operational, regulatory, and legal considerations and the interplays between them.

Scientific Expertise Clinical Insight Industry Relationships Regulatory Analysis

How we research

MDs & PhDs on the front lineOur investment team includes physicians and scientists who evaluate innovations from the perspective of clinicians, researchers, and patients.

Network-driven diligenceExtensive relationships across medical, industry, and payor ecosystems provide ongoing insight into deal flow, pipeline, and positioning.

Operational & legal rigorWe seek a thorough understanding of regulatory pathways, legal structures, and commercial dynamics before committing capital.

Focus on Quality

We seek to identify First-in-Class and Best-in-Class therapeutic innovations that we believe have the potential to change the standard of care and achieve broad adoption. Historically, these innovations have significantly outperformed Next-in-Class alternatives at launch — and we invest accordingly.

First-in-Class Best-in-Class Standard of Care Commercial Potential

Quality benchmarks

74% vs. 42% launch successFirst-in-Class therapies beat or meet consensus at launch 74% of the time, compared to 42% for Next-in-Class alternatives.

147% of forecasted valueOn average, First-in-Class products achieve 147% of their forecasted commercial value at launch versus 80% for Next-in-Class.

Our portfolio reflects this convictionAcross Medtech and Biotech, the majority of our holdings are classified as First-in-Class or Best-in-Class innovations.

Differentiated Coverage & Team Collaboration

Investment ideas are developed within a therapeutics-focused coverage model organized by therapeutic area rather than sector. This structure supports deeper domain expertise and broader coverage within each therapeutic landscape. Key questions are addressed through structured diligence and ongoing research, with the full team drawing on mutual experience and relationships.

Oncology Rare Disease Cardiology Immunology Neurology Ophthalmology

Coverage model vs. industry standard

Rock Springs: by therapeutic areaEach analyst develops deep expertise in one disease landscape — oncology, rare disease, immunology — and builds a relevant network within it.

Industry standard: by sub-sectorCoverage by sub-sector forces analysts to be generalists across device, drug, and diagnostic categories — limiting depth in any one area.

The result: broader, earlier coverageOur model enables earlier identification of first-in-class innovations across a wider universe of companies than sub-sector coverage allows.

Iterative Analysis

We use a data-driven approach and continually reassess investments as new information emerges. We scale positions as clinical and commercial risk is reduced, and trim or exit when the thesis changes. Our willingness to be unemotional — to add opportunistically during drawdowns and exit at full valuation — is a core part of how we generate alpha.

Position Sizing De-risking Up or Out Valuation Discipline

How positions evolve

Scale on milestonesWe build larger positions as companies achieve clinical, regulatory, or commercial milestones that de-risk the investment thesis.

"Up or Out" disciplineWe gain conviction to build or move on. We do not hold positions out of inertia — ongoing reconsideration is built into the process.

Patience rewards convictionDuring the Q4 2018 drawdown, we added to 49% of affected positions. The subsequent rebound delivered an average 93% recovery on those stocks.

Risk Assessment

We evaluate the potential risks and rewards of each investment on an ongoing basis, considering clinical, regulatory, commercial, and market factors. We set minimum return and risk hurdles before execution, and we manage risk continuously — viewing volatility not as a threat, but as an opportunity to concentrate positions in our highest-conviction ideas.

Risk / Reward Return Hurdles Volatility as Opportunity Ongoing Monitoring

Risk management principles

Minimum return hurdlesBefore executing any trade, we evaluate the risk/reward profile and set a minimum return threshold. We do not invest without a clearly defined upside case.

Drawdowns are opportunitiesWhen market dislocations compress valuations indiscriminately, we lean in — concentrating positions in our highest-conviction holdings.

Sell disciplineWe are willing to exit assets at the right valuation when further upside is compressed or uncertain — an unemotional, data-based assessment drives every exit decision.