Bellevue Obesity Solutions

Global equities rose in October 2025 (MSCI World Index; +2.0%), with healthcare outperforming (MSCI World Health Care Index; +3.1%) as visibility on the future pharmaceutical operating environment improved and Q3 results delivered. The Bellevue Obesity Solutions (Lux) Fund (I shares) gained 2.2% in USD, underperforming its benchmark by 92 bps.

On September 30, Pfizer became the first major pharmaceutical company to reach an agreement with the US administration on drug pricing and domestic investment, establishing a new framework for negotiated pricing and manufacturing commitments. This was followed by AstraZeneca on October 10 and Merck KGaA on October 16, both signing similar arrangements under the administration’s evolving «most-favored-nation» and «TrumpRx» initiatives. While still at an early stage, these agreements have played a meaningful role in shifting market sentiment – from one of maximum policy uncertainty to a more balanced outlook in which investors are increasingly comfortable with the likely medium-term operating environment for the global pharmaceutical industry.

After a strong month of M&A in September (Metsera, 89bio, and Merus), the trend continued in October. Novartis agreed to acquire Avidity Biosciences for USD 12 bn, expanding its RNA-therapeutics pipeline via Avidity’s AOC neuromuscular platform. Novo Nordisk continued its metabolic expansion by purchasing Akero Therapeutics for USD 5.2 bn, adding a late-stage MASH (fatty liver) asset. Meanwhile, Thermo Fisher Scientific announced plans to buy Clario, a clinical-trial data and software provider, for up to USD 9.4 bn to strengthen its drug-development services.

In October 2025, global healthcare markets saw a strong Q3 earnings season marked by beats and upgraded outlooks across subsectors. Eli Lilly, Galderma, and Intuitive Surgical were standout performers in our view, beating expectations and raising guidance. Altogether, the month was defined by solid earnings, active deal flow, and continued innovation across the healthcare complex.

Among portfolio holdings, NewAmsterdam Pharma (adjacent M&A in cardiometabolic stocks; +33%), BridgeBio (positive phase 3 readouts in limb-girdle muscular dystrophy and autosomal dominant hypocalcemia type 1; +21%), and Intuitive Surgical (strong results and procedure-growth outlook raised; +19%) delivered the strongest absolute performance for the month.

The healthcare sector is entering a new and durable phase of growth following several years of structural and policy headwinds. Healthcare equities remain materially underrepresented at less than 9% of the S&P 500 despite contributing roughly 18% to US GDP, with valuations still near decade-long lows. After a prolonged period marked by pricing uncertainty and regulatory overhang, fundamentals are stabilizing and investor confidence is returning. Within this recovery, biotechnology has emerged as a key driver – transitioning to cash-generative growth supported by premium drug pricing, leaner cost structures, and disciplined capital allocation.

Long-term secular drivers – aging populations, expanded access to healthcare in emerging markets, and accelerating innovation in fields such as AI, robotics, and precision medicine – remain firmly intact. Innovation not only drives growth but also enhances system efficiency by mitigating long-term care costs. Against this backdrop, the fund maintains a selective, high-conviction strategy with diversified exposure across obesity-, metabolism-, and fitness-related thematics, emphasizing biotechnology and life-science tools as core overweight positions to target structural and cyclical outperformance.