) --More noteworthy hedge fund trading across the biotech sector, culled from the most recent crop of 13Fs:

BioSante Pharmaceuticals looks like it's becoming a crowded hedge fund long. I count ten new positions (greater than 300,000 shares) established in the third quarter, most notably 1.77 million shares purchased by Jennison Associates. Manatuck Hill Partners also stepped up to buy 1.5 million first-time BioSante shares.All this buying makes me suspect hedge funds are lining up short-term rentals to play the release of efficacy data from Biosante's phase III trials of Libigel to be announced in December. Libigel is a low-dose testosterone gel being developed to boost the libido of menopausal women.Or maybe the six funds that sold an aggregate 4.89 million shares of BioSante in the third quarter (including five funds that zeroed out their entire positions) know better?

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Idenix Pharmaceuticals , the developer of hepatitis C drugs, saw some substantial buying led by Fidelity, which added another 2.7 million shares in the September quarter. Fidelity now owns 7.3 million shares. Westfield Capital Management added 1.9 million shares to turn what was a small position into a large one. Brookside Capital made a big bet on Idenix in the second quarter, buying up 9.1 million shares. That position has grown to almost 11 million shares at the end of the third quarter. On the other side of the trade, Orbimed liquidated a 2.7 million-share stake in Idenix, while Columbia Wanger also zeroed out, shedding 2.6 million shares. Idenix is expected to announce crucial phase IIb data on its nucleotide inhibitor IDX184 in January.

A missed opportunity in Inhibitex ( INHX)? Wellington Management sold 1.7 million shares, Baker Brothers sold 781,000 shares (exiting the position), in the third quarter. A month later, Inhibitex shares doubled in value on the release of promising new data on its hepatitis C drug INX-189.

Cyclacel Pharmaceuticals lost one of its largest, long-time shareholders. Austin Marxe and David Greenhouse, also known as Special Situations Fund, sold 3.95 million shares in the quarter to eliminate its stake in the company entirely. Stepping in with new buys were Ayer Capital (1.31 million shares) and RedMile Group (1.15 million shares.)

Seven funds liquidated positions in Ziopharm Oncology during the third quarter, although four of those sales were from relatively small positions that could have been boxes against a short.

For most of the spring, Oncothyreon was riding a hot wave as the next Dendreon , its lung cancer immunotherapy Stimuvax being compared favorably to Provenge. Today, no one wants to be the next Dendreon, which may explain why Oncothyreon's buzz has cooled considerably.Black Horse Capital sold its entire 1.12-million share stake in Oncothyreon during the third quarter -- a position the fund only established in the second quarter.Four other funds liquidated Oncothyreon positions in the September quarter, including Ayer Capital, sellers of 888,000 shares. The largest new buyer of Oncyothreon during the third quarter was Viking Global Investors, which added 3.1 million shares.

I already wrote about SAC Capital Advisors dumping more than 8 million shares of Dendreon during the quarter, but what other biotech stocks did billionaire hedge fund manager Steven Cohen trade?Some of Cohen's new biotech buys include Idenix Pharmaceuticals (+301,000 shares) and Dynavax Technologies (+3 million shares.)Cohen dumped positions in Savient Pharmaceuticals and Ista Pharmaceuticals ( ISTA) and reduced stakes in United Therapeutics , Amylin Pharmaceuticals ( AMLN) and Acorda Therapeutics .

To learn more about which biotech stocks were bought and sold during the third quarter, read

10 Biotech Stocks Loved and Hated by Wall Street's Top Investment Pros


And to see these stocks in action, visit the

13 Biotech Stocks Bought and Sold by Hedge Funds

portfolio on Stockpickr.

--Written by Adam Feuerstein in Boston.

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Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback;

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