Bellevue Emerging Markets Healthcare

Emerging markets declinced by 13.1% decline in March, driven by a 22.9% decline in South Korea’s Kospi Index, a 14.4% decline in India’s Nifty 50 as well as a 6.9% and 6.0% decline in the Hang Seng and the CSI 300, respectively. Brazil’s Ibovespa also slightly declined by 1.8%.

Emerging-market healthcare stocks declined by 10.0% this month, slightly better than the broader equity market, because of the defensive nature of the healthcare sector. The continuous volatility from the US-Iran conflict has had most severe impact on Asia, namely Korea, India and China, which are highly dependent on oil-supply through the Strait of Hormuz. The Bellevue Emerging Markets Healthcare Fund declined by -8.9%, slightly outperforming its benchmark.

Akeso (+21.5%), Mouwasat hospital (+14.1%), Dr. Sulaiman hospital (+11.8%), 3SBio (+2.9%), and Hansoh (+1.2%) were ranked among the fund’s top contributors. Akeso share rallied because management confirmed sharing of key Overall Survival (OS) data from two of the key trials (HARMONi-6 and HARMONi-2) with ivonescimab in lung cancer in the next few months at undisclosed academic conferences. This could suggest management becoming more confident on the readouts. Mouwasat and Dr. Sulaiman are both private hospitals based in Saudi Arabia, and a potential increase in patient volumes related to the US-Iran conflict supported their performance. Furthermore, a clean beat of Mouwasat’s results further helped the share price. 3SBio FY25 results were below expectation but focus was on pipeline progress and milestone payment. 3SBio collaborates with Pfizer on a lung cancer asset, and management is confident in milestone revenue contribution this year as the asset is being quickly progressed by Pfizer. Hansoh had a positive finish of the year with revenue beat and double digit growth guidance into 2026. Management is also confident in high-quality business development execution throughout the year.

Celltrion (-21.0%), Alteogen (-20.8%), Samsung Biologics (-18.7%), Wuxi Biologics (-18.1%), and BeOne (-11.0%) were the largest detractors from absolute performance. Celltrion, Alteogen and Samsung Biologics were largely impacted by the US-Iran conflict, as South Korea is highly dependent on oil from the Strait of Hormuz. Looking into more company specifics, Celltrion announced capacity expansion in the month, they also guided operating margin which was below expectation. The mixed message has led to the share price to fall. Alteogen despite announcing another agreement with Biogen, the share price did not recover due to macro headwind. Wuxi Biologics delivered strong results, but cautious guidance for next year was below expectations as management took into account macro headwinds from the US-Iran conflict. BeOne extended its decline following weaker 4Q 2025 results, as sales from key drug Brukinsa for blood cancer was slightly below expectation.

All performance data in USD/B shares.

Emerging markets are home to some of the world’s most dynamic growth economies and account for 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. Substantial 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 continues to struggle 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.