BB Biotech AG
ISIN-Nr.
CH0038389992
Valoren-Nr.
003838999
«We invest in genuine innovation, not in "me too" medicine»
Dr. Daniel Koller
Co-Head Biotech
Dr. Daniel Koller Co-Head Biotech
Dallas Webb Analyst/Portfolio Manager
Felicia Flanigan Senior Analyst/Portfolio Manager
Stefan Müller Portfolio Manager
Elhan Kosar, CFA Co-Head Biotech
Five Reasons to Invest
Strong growth driven by innovative, high-margin new therapies
Attractive valuations for fast-growing companies
Long-term track record of 16 years with above average performance
Long-term outperformance to industry benchmarks
Experienced management with strong Board
of Directors
Performance
| YTD | 1 Month | 1 Year | 3 Years | Since Inception | |
|---|---|---|---|---|---|
| Switzerland: BION SW Equity |
-26.35% | -6.01% | -23.24% | -44.72% | 133.68% |
| Germany: BBZA GY Equity |
-14.09% | 0.96% | -9.30% | -29.18% | 57.67% |
| Italy: BB IM Equity |
-13.42% | 1.53% | -10.37% | -29.15% | -63.54% |
Investment Focus
BB Biotech's objective is to generate an average return of 15% per annum with a long-term investment horizon. The investment company participates selectively in firms operating in the growth market of innovative medications and diagnostics based on modern biotechnology, with companies listed in the stock markets accounting for at least 90% of the portfolio value.
Investment Focus
BB Biotech's objective is to generate an average return of 15% per annum with a long-term investment horizon and to substantially outperform the relevant indices in the process. BB BIOTECH participates selectively in firms operating in the growth market of innovative medications and diagnostics based on modern biotechnology, with companies listed in the stock markets
accounting for at least 90% of the portfolio value. Our task is to have an in-depth knowledge of the businesses conducted by our holdings, which includes key financial ratios, also of the prevailing competitive environment, the product pipeline, the portfolio of patents and the perception of the products and services by the end customers, to name just a few aspects. The target portfolio of BB BIOTECH consists of approximately 20 to 30 holdings, no more than 5 of which account for more than 10% of equity and the largest of which should not exceed 25%. In the course of selecting its holdings, BB BIOTECH relies on the well-established experience of its Board members and the fundamental analyses by the experienced management team of Bellevue Asset Management Group, with access to a network of physicians and specialists for the sectors in question. In doing so, a detailed financial model is created for each holding, which guarantees a compelling illustration of the potential for doubling asset values in a period of four years.
accounting for at least 90% of the portfolio value. Our task is to have an in-depth knowledge of the businesses conducted by our holdings, which includes key financial ratios, also of the prevailing competitive environment, the product pipeline, the portfolio of patents and the perception of the products and services by the end customers, to name just a few aspects. The target portfolio of BB BIOTECH consists of approximately 20 to 30 holdings, no more than 5 of which account for more than 10% of equity and the largest of which should not exceed 25%. In the course of selecting its holdings, BB BIOTECH relies on the well-established experience of its Board members and the fundamental analyses by the experienced management team of Bellevue Asset Management Group, with access to a network of physicians and specialists for the sectors in question. In doing so, a detailed financial model is created for each holding, which guarantees a compelling illustration of the potential for doubling asset values in a period of four years.
General Information
| Board of Directors | Prof. Dr. Thomas Szucs Prof. Dr. David Baltimore Dr. Clive Meanwell |
| Investment Advisor | Bellevue Research Inc., Boston |
| Year end Closing | 31. December |
| Market Capitalisation | CHF 1011.5 Mio. (Sep 8, 2010) |
| ISIN Number | CH0038389992 |
| Valor Number | 003838999 |
| Bloomberg | BION SW EQUITY |
Risk
low
high
Investment Suitability
The investment company’s objective is to generate attractive and competitive capital growth in the long term. It is therefore particularly suited to investors with an investment horizon of at least 5 years who want to selectively diversify their portfolio with investments in the biotechnology sector and who are willing to accept the equity risks typical of this sector.
Share Facts
| Legal Form | AG |
| Listing | SIX Swiss Exchange, Xetra Frankfurt, Milan Stock Exchange |
| Foundation | Nov 16, 1993 |
| Share Type | Equity |
| Shares Floating | 18,225,000 |
| Authorised Capital | CHF9,100,000.00 |
| Conditional Capital | CHF9,100,000.00 |
Historical Prices
Key Data (Aug 31, 2010)
| Beta | 0.51 |
| Volatility | 23.80 |
| Tracking Error | 26.50 |
| Jensen's Alpha | -5.88 |
| Correlation | 0.55 |
| Share Ratio | -0.24 |
| Information Ratio | -0.12 |
| No. of Positions | 21 |
Source: unknown, Aug 31, 2010
Market Review
Market Review
The biotechnology sector recovered its June losses in July and closed the month with a positive performance. The recovery was based on solid 2nd quarter results from most of the large biotech companies and acquisition rumors that the pharma giant Sanofi Aventis is planning to bid for the US
biotechnology company Genzyme. Actelion (CHF, + 4.0%) reported strong Tracleer revenues of CHF 430 mn for the quarter, supporting the company’s goal to reach CHF 2 bn in revenues in 2010. Tracleer has been confirmed as the preferred treatment in first-line therapy for pulmonary arterial hypertension.
Celgene (USD, + 8.5%), published encouraging 2nd quarter financial results. Total revenue was a record USD 850.4 mn for the 2nd quarter of 2010. This result was driven by global market share gains and increased duration of therapy of Revlimid. Sales grew 48% to USD 587 mn, year-over-year. Revlimid is the key product for Celgene which is approved in the US, EU and Japan for the treatment of multiple myeloma. Gilead (USD, – 2.8%) was one of the few companies lowering its full year guidance after having done so
following its 1st quarter results. This mainly attributed to certain price cuts, the new healthcare reform implications, and foreign currency weakness. We still view Gilead as having the world’s leading HIV franchise.
Newsflow
Vivus (USD, – 41%), a competitor of Arena (USD, +159%) had its advisory committee panel mid July for its obesity drug, Qnexa, where the panel voted 10 – 6 against the risk/benefit profile. The main reason for the rejection is that the two drugs that make up Qnexa are associated with increased heart rate and cognitive problems as major side effects. We still believe that Arena, with its obesity drug candidate, lorcaserin, is best suited for approval. The panel discussion on lorcaserin is expected to take place in September. Additionally, Arena recently partnered US rights with Eisai, providing near term cash infusions, decreased commercialization risk, and lucrative royalty on sales. The prevalence of obesity continues to be a health concern that affects a large and growing proportion of the population, including more than 72 mn
American adults. Worldwide more than 400 mn people are obese. Obesity directly contributes to numerous life-threatening conditions, e.g. diabetes, cardiovascular disease, hypertension and stroke and is the 2nd leading cause of preventable death in the USA. Beyond its impact on health, obesity economically accounts for 9.1% of US annual health care spending – nearly USD 150 bn.
Positioning and Outlook
Further clarifications of the US healthcare reform and its implementation combined with the EU price implications will be of importance to set the stage for a continued recovery in healthcare equities in the second half of 2010. Also on the positive side, the recent acquisition plans of Sanofi Aventis are, in
our view, only the beginning of a more extensive consolidation in the sector. If operational progress will not be reflected in share prices and multiples, an increase in M&A is foreseeable.
The biotechnology sector recovered its June losses in July and closed the month with a positive performance. The recovery was based on solid 2nd quarter results from most of the large biotech companies and acquisition rumors that the pharma giant Sanofi Aventis is planning to bid for the US
biotechnology company Genzyme. Actelion (CHF, + 4.0%) reported strong Tracleer revenues of CHF 430 mn for the quarter, supporting the company’s goal to reach CHF 2 bn in revenues in 2010. Tracleer has been confirmed as the preferred treatment in first-line therapy for pulmonary arterial hypertension.
Celgene (USD, + 8.5%), published encouraging 2nd quarter financial results. Total revenue was a record USD 850.4 mn for the 2nd quarter of 2010. This result was driven by global market share gains and increased duration of therapy of Revlimid. Sales grew 48% to USD 587 mn, year-over-year. Revlimid is the key product for Celgene which is approved in the US, EU and Japan for the treatment of multiple myeloma. Gilead (USD, – 2.8%) was one of the few companies lowering its full year guidance after having done so
following its 1st quarter results. This mainly attributed to certain price cuts, the new healthcare reform implications, and foreign currency weakness. We still view Gilead as having the world’s leading HIV franchise.
Newsflow
Vivus (USD, – 41%), a competitor of Arena (USD, +159%) had its advisory committee panel mid July for its obesity drug, Qnexa, where the panel voted 10 – 6 against the risk/benefit profile. The main reason for the rejection is that the two drugs that make up Qnexa are associated with increased heart rate and cognitive problems as major side effects. We still believe that Arena, with its obesity drug candidate, lorcaserin, is best suited for approval. The panel discussion on lorcaserin is expected to take place in September. Additionally, Arena recently partnered US rights with Eisai, providing near term cash infusions, decreased commercialization risk, and lucrative royalty on sales. The prevalence of obesity continues to be a health concern that affects a large and growing proportion of the population, including more than 72 mn
American adults. Worldwide more than 400 mn people are obese. Obesity directly contributes to numerous life-threatening conditions, e.g. diabetes, cardiovascular disease, hypertension and stroke and is the 2nd leading cause of preventable death in the USA. Beyond its impact on health, obesity economically accounts for 9.1% of US annual health care spending – nearly USD 150 bn.
Positioning and Outlook
Further clarifications of the US healthcare reform and its implementation combined with the EU price implications will be of importance to set the stage for a continued recovery in healthcare equities in the second half of 2010. Also on the positive side, the recent acquisition plans of Sanofi Aventis are, in
our view, only the beginning of a more extensive consolidation in the sector. If operational progress will not be reflected in share prices and multiples, an increase in M&A is foreseeable.
Positioning and Outlook
n.a.
Top 10 Positions
Actelion
20.8%
Celgene
17.8%
Gilead Sciences
15.5%
Vertex Pharmaceut.
12.7%
Novo-Nordisk
5.5%
Micromet
2.8%
Incyte
2.6%
Immunogen
2.6%
Zymogenetics
2.4%
Amgen
2.1%
Breakdown by Sector
Infectious disease
34.0%
Oncology
31.0%
Cardiovascular
21.0%
Metabolic disease
7.0%
Autoimmune disease
2.0%
Others
5.0%
Geographic Breakdown
United States
68.0%
Switzerland
23.0%
Denmark
7.0%
Others
2.0%