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: 22.09.2022)
NAV: USD 485.84 (22.09.2022)
Rolling performance (22.09.2022)
|22.09.2021 - 22.09.2022||-27.06%||-29.61%|
|22.09.2020 - 22.09.2021||23.19%||26.43%|
|20.09.2019 - 22.09.2020||24.34%||27.00%|
|21.09.2018 - 20.09.2019||-10.67%||-11.21%|
Annualized performance (22.09.2022)
|Since Inception p.a.||10.59%||13.45%|
Cumulative performance (22.09.2022)
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)||2.17% (31.08.2022)|
|Legal form||SICAV Luxembourg jurisdiction|
|SFDR category||Article 8|
Key data (31.08.2022, base currency USD)
|No. of positions||56|
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 traded lower across the board in August. The S&P 500 dropped 4.1%, the Nasdaq Biotech Index lost 1.0% and the Bellevue Biotech (Lux) Fund shed 2.4% (USD / B shares).
After initially making gains in August, stocks headed south across a broad front as central bankers signaled their strong determination to bring inflation under control. Positive US labor market data with moderate upward pressure on wages have led to expectations that such a resolute stance would be possible while causing an only mild slowdown in economic activity. In the biotech sector attention focused on drug pricing reforms included in the Inflation Reduction Act and on the latest round of acquisitions. For the first time, the government-run Medicare health insurance program will be able to directly negotiate prices for top-selling drugs. The reforms will be gradually implemented by the end of the current decade. The M&A carousel continued to spin in August. Amgen bought Chemocentryx for USD 3.4 bn, a markup of 124% over the pre-announcement price. Pfizer was active again too and bid USD 5.4 bn for Global Blood Therapeutics, valuing the target with a premium of 89%. Merck’s long-awaited bid for Seagen is still stuck at the negotiating table though.
The following companies made the best contribution to the portfolio's performance in August: Alnylam Therapeutics presented positive Phase III data from its APOLLO-B study of patisiran in patients with transthyretin amyloid cardiomyopathy. This news also benefited Alnylam's rivals Ionis, which is conducting a large clinical trial in amyloidosis, and Intellia. Ionis and Alnylam will present more detailed data at the International Symposium on Amyloidosis in early September. THE APOLLO data show that reducing pathogenic protein is an effective approach for treating patients with ATTR-CM, which has attracted increasing attention as an important cause of heart failure. The latest takeover activity also lifted the share price of Cytokinetics, a potential target. It reiterated its outlook for the second half of the year.
Performance detractors were Seagen after an arbitrator issued a decision in favor of Daiichi Sankyo in their dispute over the use of Seagen's ADC technology; Ono Pharmaceutical was marked down due to the pending drug price reforms in the US; and Harmony Biosciences corrected although its top-selling product Pitolisant received a patent extension to 2030.
Our stance towards the biotech sector remains positive in view of its strong fundamentals and very attractive valuations (average 2023 P/E of 14x and PEG of 0.9 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 17x, PEG 2.0) and the S&P Index (P/E 17x, PEG 1.7).
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