Liquidia Drives Arquitos Capital’s 64.8% Q2 Return

Arquitos Capital Management reported a 64.8% net return in the second quarter of 2026, lifting its year-to-date return to 52.9%. The fund manager attributed much of its recent performance to Liquidia (LQDA), whose shares rose fivefold over the past year as its Yutrepia drug launch exceeded expectations. Liquidia was the fund’s largest position when its long-dated call options were included. A court decision over a United Therapeutics patent remains a potential catalyst, with outcomes ranging from a clean win for Liquidia to a royalty requirement or, less likely, restrictions on its PH-ILD label. Arquitos estimates potential share values of $140 in a clean-win scenario, $123 with royalties and $70 in its adverse scenario. The fund also opened a position in Abivax (ABVX) after safety data for its ulcerative colitis drug eased market concerns about cancer risk. Abivax shares recovered, and the company raised capital at $125 per share. Arquitos said it holds about 10% of its portfolio in Abivax shares and call options, and expects a potential acquisition to be the next major catalyst. Finch Therapeutics (FNCHQ) delivered a weaker outcome: a court awarded damages and royalties, and its assets were sold through bankruptcy proceedings. Arquitos said the investment is likely to produce a low double-digit return over two years. Liquidia remains central to the fund’s concentrated portfolio and its performance outlook.