Bellevue Biotech (Lux)
Biotech sector with sustainable, strong sales and earnings growth thanks to high innovation level
Expiring patents of pharma companies lead to high M&A activity (patent cliff)
Valuations very attractive on historical average over the last 10 years
Please find a more detailed description of share classes here.
The Fund invests worldwide in companies active in the biotechnology sector. Experienced sector specialists focus on profitable mid- and large-cap companies with an established product portfolio. Stock selection is based on fundamental analysis. The selection of portfolio companies is entirely bottom-up, independent of benchmark weightings.
Indexed performance (as at: 24.06.2022)
NAV: USD 529.94 (22.06.2022)
Rolling performance (22.06.2022)
|22.06.2021 - 22.06.2022||-24.20%||-27.68%|
|22.06.2020 - 22.06.2021||15.97%||16.08%|
|21.06.2019 - 22.06.2020||24.96%||26.20%|
|22.06.2018 - 21.06.2019||-2.81%||-2.50%|
Annualized performance (22.06.2022)
|Since Inception p.a.||11.53%||13.48%|
Cumulative performance (22.06.2022)
Facts & Key figures
The Fund invests worldwide in companies active in the biotechnology sector. Experienced sector specialists focus on profitable mid- and large-cap companies with an established product portfolio. Stock selection is based on fundamental analysis, in particular of the medical indications addressed, the means of efficacy and the market potential. A global network of experts spanning scientific and industrial fields supports the Management Team in forming opinions and making investment decisions. The selection of portfolio companies is entirely bottom-up, independent of benchmark weightings.Show moreShow less
Investment suitability & Risk
|Investment Manager||Bellevue Asset Management AG|
|Custodian||RBC Investor Services, Luxembourg|
|Fund Administrator||RBC Investor Services, Luxembourg|
|Year end closing||30. Jun|
|NAV Calculation||Daily "Forward Pricing"|
|Cut of time||15:00 CET|
|Subscription Fee (max.)||5.00%|
|Total expense ratio (TER)||2.21% (31.05.2022)|
|Legal form||SICAV Luxembourg jurisdiction|
|SFDR category||Article 8|
Key data (31.05.2022, base currency USD)
|No. of positions||55|
Top 10 positions
Breakdown by sector
Opportunities & Risks
- New innovative drugs are powering sustainable momentum in the biotech sector.
- Attractively valued large-cap biotechs.
- Expiring pharmaceutical patents trigger a rise in M&A activity.
- Focus on US biotech companies with strong growth potential.
- Bellevue has been a Healthcare pioneer since 1993 and is one of the biggest independent investors in the sector in Europe today.
- Equities are subject to strong price fluctuations and so are also exposed to the risk of price losses.
- Market, industry or company factors can lead to strong short-term price fluctuations
- The fund invests in foreign currencies, which means a corresponding degree of currency risk against the reference currency.
- Investing in emerging markets entails the additional risk of political and social instability.
- The fund may invest in financial instruments that might have a rather low level of liquidity, which can in turn affect the fund’s liquidity.
Review / Outlook
Stock markets showed a divergent performance in May. The S&P 500 closed the month virtually unchanged, the Nasdaq Biotech Index slipped 1.3% and the Bellevue Biotech (Lux) Fund returned a negative 2.6% (USD / B shares).
US monetary policy tightening, the ongoing war in Ukraine and rigid pandemic restrictions in China are keeping stock markets under pressure. China recently softened its zero-tolerance policy, though, which should help manufacturing to get back to normal. In the US, household consumption remains strong despite a deterioration in consumer sentiment. The EU is imposing more sanctions on Russia and has banned most imports of Russian oil effective at the end of 2022. Higher interest rates are becoming a widespread issue, and European central bankers have come under pressure to tighten monetary policy too. Pressure on the COVID-19 front has eased thanks to the seasonally warmer weather, but the outbreak of monkeypox is another reminder how important effective vaccines and adequate vaccine supplies are. This is also reflected in GSK's USD 3.3 bn bid for the unlisted vaccine manufacturer Affinivax. Pfizer is also back on the M&A trail, having signed an agreement to acquire Biohaven for USD 11.6 bn. Shortly before ASCO, the world's largest cancer conference, opened, Legend Biotech/Janssen were granted conditional marketing authorization for their cell therapy CARVYKTI (cilta-cel) in Europe.
Below is an overview of the portfolio's top performers in May: Biohaven soared on the news of Pfizer's takeover offer of USD 11.6 bn, a premium of 73% to the stock's previous closing price. Argenx benefited from the good market uptake of efgartigimod for the treatment of autoimmune diseases including myasthenia gravis (gMG), and announced positive Phase III data for the treatment of immune thrombocytopenia (ITP). Legend Biotech shares advanced on the news that cilta-cel had been granted marketing authorization for the treatment of adults with relapsed or refractory multiple myeloma (r/rMM) in Europe, because the European Commission granted conditional approval even before comprehensive clinical data is available.
Performance detractors were Genmab, despite having reported good quarterly results and pipeline progress; UCB corrected after the FDA issued a complete response letter regarding bimekizumab for the treatment of adults with psoriasis, citing issues with facility inspections that need to be resolved; and Ultragenyx was weak despite progress in its R&D program and a reiterated positive outlook for the year.
Our stance towards the biotech sector remains positive in view of its strong fundamentals and very attractive valuations (average 2023 P/E of 13x and PEG of 1.5 for large caps). These are still very attractive multiples compared to the biotech sector's historical valuations and the current ratios for the pharma sector (P/E 16x, PEG 1.9) and the S&P Index (P/E 17x, PEG 1.5).
The companies in our portfolio are working on technologies or products for novel treatment solutions. We are also invested in selected specialty pharma companies that offer high growth rates and moderate valuations. The Bellevue Biotech (Lux) Fund is well-positioned to profit from the milestones that are expected to be reached in 2022. The regulatory environment favors the innovation coming out of biotech labs and the coronavirus crisis has improved the image of drug developers. In addition to the growing piles of cash that the larger biopharmaceutical companies are accumulating, we also believe low valuations and the attractive pipeline candidates of biotech companies in the small and mid cap space could trigger M&A activity going forward.
Past performance is not a reliable indicator of future results and can be misleading. As the sub-fund is denominated in a currency that may differ than an investor’s base currency, changes in the rate of exchange may have an adverse effect on prices and incomes. Performance is shown net of fees and expenses for the relevant share class over the reference period. 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. Individual costs are not taken into account and would have a negative impact on the performance. With an investment amount of EUR 1,000 over an investment period of five years, the investment result in the first year would be reduced by the front-end load of up to EUR 50 (5%) as well as by additional individual custody charges. In subsequent years, the investment result would also be reduced by the individual custody account costs incurred. The reference benchmark of this class is used for performance comparison purposes only (dividend reinvested). No benchmark is directly identical to a sub-fund, thus the performance of a benchmark is not a reliable indicator of future performance of the sub-fund 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. All figures in base currency in %, calculated by the total return / BVI method.Show moreShow less