BB Biotech AG
New innovative drugs and technologies are powering sustainable momentum in the biotech sector
Focus on profitable companies and small and mid-cap companies with strong pipelines
Attractive dividend policy; Dividend payment of 5% p.a.
BB Biotech aims to achieve an average annual double-digit return over the long term, thus outperforming the broad market indices by a significant margin. BB Biotech invests worldwide in fast growing companies developing and marketing innovative biotech drugs.
Indexed performance (as at: 20.05.2022)
Share price: CHF 55.00 (19.05.2022)
NAV: CHF 43.00 (19.05.2022)
Rolling performance (19.05.2022)
|Share price||NAV||XNBI CHF|
|19.05.2021 - 19.05.2022||-24.71%||-28.19%||-14.90%|
|19.05.2020 - 19.05.2021||17.50%||8.23%||5.97%|
|17.05.2019 - 19.05.2020||4.35%||12.02%||22.26%|
|18.05.2018 - 17.05.2019||8.37%||4.57%||-1.93%|
Annualized performance (19.05.2022)
|Share price||NAV||XNBI CHF|
|Since Inception p.a.||11.80%||10.79%||9.23%|
Cumulative performance (19.05.2022)
|Share price||NAV||XNBI CHF|
|Share price||NAV||XNBI CHF|
Facts & Key figures
BB Biotech aims to achieve an average annual double-digit return over the long term, thus outperforming the broad market indices by a significant margin. BB Biotech invests worldwide in fast growing companies developing and marketing innovative biotech drugs. At least 90% of its shareholdings must be in listed companies. Positions in emerging-market biotech companies will be taken on a selective basis.
BB Biotech invests in fast-growing biotechnology companies that are developing and marketing innovative drugs. It focuses on biotech companies whose products address areas of significant unmet medical needs and that are generating above-average sales and profit growth. With an aggregate weighting of more than 90%, listed companies account for most of its portfolio investments. BB Biotech has also taken a stake in the structural growth opportunities that emerging markets offer.
We seek a thorough understanding of the activities pursued by our participations, i.e., not only the purely financial aspects of the business, but also the respective competitive environment, the innovation pipeline, patent portfolios and the market perception of each company’s products and services, to name only a few other aspects.
The target portfolio of BB Biotech will generally consist of 20 to 35 participations. Large positions will be taken in five to eight companies, the top holdings. Together they will account for no more than two-thirds of the portfolio and no single position will have a weighting greater than 25% of portfolio investments.
Due to their substantial portfolio weighting, in general the top holdings should be generating both revenues and income. The portfolio’s smaller participations are companies with promising drug candidates in their pipelines. BB Biotech has deliberately chosen not to construct a portfolio of statistical relevance as it attaches importance to the depth of sector and company expertise and seeks personal access to the management of our equity interests.
The asset classes BB Biotech can invest in are stocks, equity interests in unlisted companies, corporate bonds and options on a range of underlying assets.
BB Biotech invests its capital in stocks for liquidity and risk/reward reasons. Investments in private companies can account for up to 10% of the portfolio. These positions will have a higher weighting when stock market performance is positive over a prolonged period.
Corporate bonds are a suitable investment when stock market trends are negative. Options on the stocks of portfolio companies are bought and sold at opportune times and as a means of hedging currency exposure.Show moreShow less
Investment suitability & Risk
|Investment Manager||Bellevue Asset Management AG|
|Custodian||Bank Julius Bär AG|
|Fund Administrator||Bellevue Asset Management AG|
|Year end closing||31. Dec|
|Bloomberg||BION SW Equity|
Key data (29.04.2022, base currency CHF)
|No. of positions||31|
Portfolio as at 31.03.2022
Breakdown by sector
Opportunities & Risks
- Unique opportunity for European investors to access the global biotech sector, a noncyclical growth industry that is strongly supported by increasing demand, driven by demographic trends and life style changes.
- New innovative drugs and technologies are powering sustainable momentum in the biotech sector.
- Focus on a diversified portfolio of profitable companies as well as small and midcap companies with strong pipelines.
- Management Team with strong scientific and medical expertise. Renowned threemember Board of Directors.
- Attractive dividend policy; Dividend payment of 5% p.a.
- BB Biotech invests in equities. Equities are subject to strong price fluctuations and so are also exposed to the risk of price losses.
- Biotech equities can be subject to sudden substantial price movements owning to market, sector or company factors.
- BB Biotech invests in foreign currencies, which means a corresponding degree of currency risk against the reference currency.
- The price investors pay or receive, like other listed shares, is determined by supply and demand and may be at a discount or premium to the underlying net asset value of the Company.
- BB Biotech may take a leverage of up to 15%, which may lead to even higher price movements compared to the underlying market.
Review / Outlook
For the biotech sector April was one of the worst months with regard to the performance. Investors sold out and looked for safer bets. The Nasdaq Biotech Index fell nearly 10% (in USD) in April and BB Biotech´s share price followed this trajectory by declining -13.7% (in USD). Early-stage biotech companies have been hit the hardest whereas the more established and profitable companies have held up better.
BB Biotech reported its first quarter result on April 22 showing a net loss of CHF 300 mn, compared to net profit of CHF 221 mn in the same period of 2021. The position in Biogen was fully divested in the first quarter. As of the end of the first quarter, BB Biotech's portfolio consisted of 31 positions. Overall, the portfolio was further concentrated, with the eight largest positions accounting for more than 60% of Net Asset Value. The ranking of portfolio exposure in terms of therapeutic areas is now led by rare diseases followed by oncology and neurology. No new investments were made in the first quarter.
Please find below selected highlights from a few of BB Biotech´s portfolio companies:
Ionis (-0.8%, in USD) and its partner AstraZeneca announced on April 14 positive data from the ETESIAN Phase IIb study of ION449, an investigational antisense medicine designed to reduce blood cholesterol levels in patients with hypercholesterolemia by targeting proprotein convertase subtilisin/kexin type 9 (PCSK9). These data were presented at the American College of Cardiology´s 71st Annual Scientific Session & Expo.
Myovant (-30.1%, in USD) and its partner Pfizer announced on April 12 an update on the Supplemental New Drug Application (sNDA) for MYFEMBREE® (relugolix 40 mg, estradiol 1 mg and norethindrone acetate 0.5 mg) for the management of moderate to severe pain associated with endometriosis. In accordance with the ongoing review of the application, on April 6 2022, the FDA provided notice to the companies that the agency identified deficiencies that preclude discussion of labeling and/or post-marketing requirements and commitments at this time. The FDA did not provide additional details. The FDA noted that the letter does not reflect a final decision on the pending sNDA and that the application is still under review. Myovant and Pfizer will continue to work with the FDA to determine next steps with the application.
Vertex Pharmaceuticals (+4.7% in USD) benefited by negative clinical results from its competitor Abbvie for the treatment of Cystic Fibrosis. Similar to Vertex’s Trikafta, AbbVie’s treatment was a three-drug combination meant to correct and regulate the dysfunctional proteins that cause cystic fibrosis. AbbVie had been evaluating this triplet, considered a threat to Vertex’s cystic fibrosis franchise. According to the company, a recent interim analysis of the data found the addition of the third drug (ABBV-119) did not offer a significant improvement on two key health measures for cystic fibrosis patients.
With the significant market corrections we are seeing very attractive valuation levels among the listed biotech companies. The investment team will continue to seek investments in biotech companies that deploy novel approaches to create breakthrough clinical benefits for patients and society.
Past performance is not a reliable indicator of future results and can be misleading. Changes in the rate of exchange may have an adverse effect on prices and incomes. All performance figures reflect the reinvestment of dividends and do not take into account the commissions and costs incurred on the issue and redemption of shares, if any. The reference benchmark is used for performance comparison purposes only (dividend reinvested). No benchmark is directly identical to the investment company, thus the performance of a benchmark is not a reliable indicator of future performance of BB Biotech it is compared to. There can be no assurance that a return will be achieved or that a substantial loss of capital will not be incurred.Show moreShow less