Bellevue Emerging Markets Healthcare

Emerging markets delivered a mixed performance in November. South Korea’s Kospi fell 6.8%, while India’s Nifty 50 rose 1.3% and Brazil’s Ibovespa advanced 7.3%. Hong Kong’s Hang Seng Index was little changed, slipping 0.3%, and China’s CSI 300 declined 1.8%. Overall, the MSCI Emerging Markets Index dropped 2.4% for the month.

Emerging-market healthcare stocks rose 0.8% in November, outpacing the broader market as investors started to rotate toward more defensive sectors and several political overhangs receded with Pfizer’s most-favored-nation pricing settlement and new obesity-drug reimbursement agreements from Eli Lilly and Novo Nordisk with the US government. The group also benefited from generally solid quarterly earnings. The Bellevue Emerging Markets Healthcare Fund gained 0.5%, remaining in positive territory but slightly lagging its benchmark.

Hansoh (+12.7%), BeOne (+10.0%), Akeso (+8.2%), Innovent (+8.0%) and Sun Pharma (+7.6%) were among the fund’s strongest absolute contributors. Hansoh advanced after signing a partnership with Roche, underscoring the depth of its pipeline and reinforcing its standing as one of China’s most innovative drugmakers. BeOne extended gains as its cancer drug Brukinsa became the US market-share leader in blood-cancer therapies, overtaking offerings from AstraZeneca and Eli Lilly. Akeso benefited from encouraging long-term survival data for ivonescimab, its PD-1/VEGF bispecific antibody for solid tumors, highlighting the therapy’s commercial potential. Innovent posted a solid quarter and provided additional clarity around its co-development agreement with Takeda, bolstering investor sentiment. Sun Pharma delivered better-than-expected results, signaling continued progress in building out its US business.

WuXi Biologics (-14.1%), WuXi XDC (-13%), Dr. Sulaiman Al Habib (-10.8%), Samsung Biologics (-10.4%) and WuXi AppTec (-7.0%) were the biggest drags on absolute performance. Shares of the WuXi companies, including Biologics, AppTec and XDC, fell on post-earnings profit-taking and continued uncertainty surrounding the proposed BioSecure Act in the US, even though no specific firms have been named in the legislation. Dr. Sulaiman Al Habib declined after reporting softer-than-expected revenue and a sharper drop in gross margins tied to higher fixed costs from recent capacity expansions. Samsung Biologics, which resumed trading following a stock spinoff, saw volatility as investors repositioned and evaluated the new entity.

All performance data in USD/B shares.

Emerging markets are home to some of the world’s most dynamic growth economies and more than half of the global population. By 2050, Asian emerging economies are expected to generate over 50% of global economic output. As incomes rise, many of these economies are shifting from industry-led growth toward service-driven models. A growing middle class is fueling demand for modern medicine, as health becomes an increasingly important priority. Massive investments in infrastructure, technology, and research are accelerating the modernization of healthcare systems, broadening access to higher-quality care. At the same time, demographic shifts are adding to demand. In 25 years’ time, China alone is expected to have nearly 400 million people over the age of 65, creating a significant need for advanced healthcare services and medicines.

Beyond Asia, attractive investment opportunities are also emerging in Brazil’s rapidly expanding private healthcare market. As the public healthcare system struggles with quality and long waiting times, many affluent Brazilians are increasingly turning to private providers for better services. One notable example of beneficiaries of this trend can be found in hospital chains, which are building vertically integrated ecosystems to capture sustainable long-term growth.