BB Biotech AG investing in leading science

Transcription

1 BB Biotech AG investing in leading science SECA Conference, July Only for professional investors Dr. Daniel Koller, Head Portfolio Management, BB Biotech AG

2 Caution regarding forward-looking statements The following information contains certain forward-looking statements, relating to the Company s business, which can be identified by the use of forward-looking terminology such as estimates, believes, expects, may, are expected to, will, will continue, should, would be, seeks, pending or anticipates or similar expressions, or by discussions of strategy, plans or intentions. Such statements may include descriptions of the Company s investment, research, holdings and anticipated expenditures. These are in connection with descriptions of new products expected to be introduced by a portfolio company and anticipated customer demand for such objects and products of a portfolio company in the Company s existing portfolio. Such statements reflect the current views of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performances or achievements that may be expressed or implied by such forward-looking statements, including, without limitation: fluctuations in interest rates and currency values, changes in economic and political conditions, legislative or regulatory developments, technological developments and competition. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated or expected, and the reader is therefore cautioned not to place undue reliance on these statements. This material is not intended as an offer or solicitation for the purchase or sale of shares of BB Biotech. This material may not be distributed within the United States or any other country where it may violate applicable law. 2

3 Agenda BB Biotech AG Facts & Figures Biotechnology Industry Overview & Outlook Investing in Innovation Process & Examples Investment Strategy Portfolio & Performance Appendix Examples: Investing in new technologies 3

4 BB Biotech AG Facts and figures Founded in Switzerland in November 1993 as an investment company A leading biotech investor with market cap of CHF 3.7 bn (July 2nd 2018) Listed on three stock exchanges: Zurich, Frankfurt, Milan Member of the Stoxx Europe 600 and the Star Index Managed by a high profile board of directors and a scientific investment team 24 years track record Average daily liquidity (2018) CHF 12 mn Dividend paid out on March 19th, 2018 CHF 3.30 per share (5% dividend yield) Share repurchase program 10% of outstanding shares over 3 years Leverage (as of March 31st, 2018) 8.7% Average premium (2018 YTD) 7.7% Total Expense Ratio p.a. (2017) 1.24% Source: Bloomberg, Bellevue Asset Management AG 4

5 Agenda BB Biotech AG Facts & Figures Biotechnology Industry Overview & Outlook Investing in Innovation Process & Examples Investment Strategy Portfolio & Performance Appendix Examples: Investing in new technologies 5

6 Biotechnology Industry Dynamic biotech sector and M&A in BION Portfolio 1 R&D productivity and approvals 46 new drug approvals in 2017 Numerous and important R&D milestones reached R&D wise biotech continues to be significantly more effective than pharma 2 Sustained high sales growth rates 200' ' '000 50'000 54'102 61'572 Biotech - Global Sales 120' ' '972 69'996 78' ' ' ' E 2018E 2019E M&A activity in BION portfolio Source: Global Biotech (NBI + Ex-US) without Specialty Pharma, Generics & Life Science Tech; BAM Research, June

7 E 2019E 2020E 2021E 2022E (USD bn) PX Nasdaq Biotech Index Biotechnology Industry 20 years biotechnology shift to a mature industry Sales, Profitability and Performance of US Biotech Companies (NBI) $120 $105 $90 $ $60 $45 $30 $15 $ $(15) Oper Inc Adj (USD bn) Net Prof Adj (USD bn) PX NBI (EoY) Source: Bellevue Asset Management; Bernstein Research, June

8 Biotechnology Industry Fund raising activity in 2018 Acceleration of capital raised in 2018, in contrast to specialist fund flows remaining in negative territory Source: BioCentury, June

9 Biotechnology Industry Biotechnology IPOs in 2017 & YTD 2018 US listings continue to outpace Europe, what about Hong Kong? US EU Switzerland YTD US EU Switzerland Source: Bloomberg; locarblog.com; Kempen & Co 9

10 Biotechnology Industry M&A activity in the public markets Announced M&A in public traded companies in Q Source: BioCentury, April

11 Biotechnology Industry M&A activity in the public markets Announced M&A in public traded companies in Q Source: BioCentury, July

12 Agenda BB Biotech AG Facts & Figures Biotechnology Industry Overview & Outlook Investing in Innovation Process & Examples Investment Strategy Portfolio & Performance Appendix Examples: Investing in new technologies 12

13 Investing in Innovation Investment process Idea Generation Due Diligence Investment Monitoring Indication Disease Platform Technology Mechanism of Action Products / Drugs Companies Innovation Management IP Financials Pharmaco - economics Investment Clinical data Medical conferences Risk management Universe 800 companies Focus companies Candidate selection 150 companies Portfolio companies Continuing industry analysis: holding interviews with physicians and specialists, going to medical conferences, reading scientific literature, organising meetings with management Financial models Regular site visits, monthly board meetings, Strategy-Meeting Risk Tool Bloomberg Port Source: Bellevue Asset Management Research 13

14 Investing in Innovation What s next in the field of medicine? New emerging therapeutic areas could yield multi billion USD revenues Immuno- Oncology $10bn Liver Diseases $10bn Orphan Diseases $10bn Central Nervous System $10bn 14

15 Investing in Innovation BB Biotech opts increasingly for new technologies sirna mrna G Gene therapy Cell-based therapy Antisense RNA sirna Bi-specific antibody Peptide Protein Antibody Small Molecule Source: Bellevue Asset Management Research, March

16 Agenda BB Biotech AG Facts & Figures Biotechnology Industry Overview & Outlook Investing in Innovation Process & Examples Investment Strategy Portfolio & Performance Appendix Examples: Investing in new technologies 16

17 Growth Investment Strategy How we invest Gilead Celgene Alexion Incyte Ionis Radius Health Probiodrug Private Equity Big Cap Mid Cap Big Pharma Investment criteria and strategy Focus on mid & large caps Long-term investments ROI target: 15% p.a. Portfolio 5-8 core holdings Diversification through smaller positions Up to 10% private equity possible Currency High USD exposure Investment grade young attractive mature 95% - 115% (up to 15% leverage) Investment focus 17

18 Investment Strategy BB Biotech s history in private equity 15 deals over 24 years, declining investment activity in private equity over the last decade Note: Portfolio as of March 31st,

19 Investment Strategy BB Biotech portfolio composition 0% 2% 4% 6% 8% 10% 12% Ionis Pharmaceuticals Incyte Celgene Neurocrine Biosciences Vertex Pharmaceuticals Radius Health Agios Pharmaceuticals Gilead Esperion Therapeutics Halozyme Therapeutics Sage Therapeutics Alexion Pharmaceuticals Novo Nordisk Alnylam Pharmaceuticals Regeneron Pharmaceuticals Tesaro Myovant Sciences Moderna Therapeutics Macrogenics Akcea Therapeutics AveXis Intra-Cellular Therapies Voyager Therapeutics Wave Life Sciences Intercept Pharmaceuticals Argenx Alder Biopharmaceuticals Novavax Five Prime Therapeutics Prothena Corp. Probiodrug Cidara Therapeutics Achillion Pharmaceuticals Idorsia new in 1Q2018 new in 1Q2018 IPO participation cross-over & IPO participation cross-over participation Note: Portfolio as of March 31st,

20 Investment Strategy Portfolio breakdown Main focus on US mid & large-cap companies that address unmet medical needs, especially in oncology and infectious diseases 1 Strong focus remains on high 2 US investments continue to 3 unmet needs dominate the portfolio Mid-cap companies offer ideal risk/reward profiles 1 6.1% 6.2% 4.3% 30.0% 3.6% 0.4% 0.1% 33.0% 2.7% 0.6% 25.3% 11.9% 15.7% 25.7% 95.9% 38.3% Oncology Orphan Diseases Neurological Diseases Infectious Diseases Others Metabolic Diseases Cardiovascular Diseases USD DKK EUR CHF > 30 bn 5 bn - 30 bn 1 bn - 5 bn 500 mn - 1 bn < 500 mn Note: As of March 31st 2018, in % of securities. 20

21 Investment Strategy BB Biotech AG: Performance in USD 1 year 3 years 5 years Net Asset Value (NAV): % Share price (SHS): +24.3%* Nasdaq Biotech Index (NBI): +14.4% Net Asset Value (NAV): -7.9% Share price (SHS): +24.3%* Nasdaq Biotech Index (NBI): -9.7% Net Asset Value (NAV): % Share price (SHS): %* Nasdaq Biotech Index (NBI): +85.3% * incl. dividends * incl. dividends Source: Bloomberg as of May 31st Indexed performance in USD. 21

22 Investment Strategy Performance in USD since inception Share Share return return in USD in p.a. USD 15.7% p.a. 1 NAV return NAV return in USD in p.a. USD 15.0% p.a Share price (SHS): %* Net Asset Value (NAV): %* Nasdaq Biotech Index (NBI): % * incl. dividends Source: Bloomberg as of May 31st, Indexed performance in USD. 22

23 Contact Silvia Schanz, Investor Relations, Maria-Grazia Iten-Alderuccio, Investor Relations, Claude Mikkelsen, Investor Relations, Bellevue Asset Management Seestrasse 16 CH-8700 Zürich-Küsnacht Switzerland Tel Fax

24 5 Appendix 24

25 Appendix BB Biotech opts increasingly for new technologies RNA-based technologies Ionis (2010) Antisense (inhibition of protein production) Alnylam (2012) sirna (inhibition of protein production) Wave Life Science (2017) sirna and Antisense (inhibition of protein production) Akcea (2017) Antisense (inhibition of protein production) Moderna (2018, Private Equity) mrna (protein production) Source: Bellevue Asset Management Research, March

26 Appendix BB Biotech opts increasingly for new technologies Cell-based therapies Kite Therapeutics ( ) Gilead acquisition of USD 12 bn Yescarta approval in October 2017 Juno Therapeutics ( ) Celgene acquisition of USD 9 bn Source: Bellevue Asset Management Research, March

27 Appendix BB Biotech opts increasingly for new technologies Gene therapies - Adeno-associated Virus (AAV) Avexis (2016) AAV9 based Expression of SMN protein Approval study for SMA Typ 1 Phase 1 study for SMA Typ 2 Voyager Therapeutics (2017) AAV2-AADC intracranial injection Production of the dopamineconverting enzyme Source: Bellevue Asset Management Research, March