BB Biotech AG

For the biotech sector April was one of the worst months with regard to the performance. Investors sold out and looked for safer bets. The Nasdaq Biotech Index fell nearly 10% (in USD) in April and BB Biotech´s share price followed this trajectory by declining -13.7% (in USD). Early-stage biotech companies have been hit the hardest whereas the more established and profitable companies have held up better.
 
BB Biotech reported its first quarter result on April 22 showing a net loss of CHF 300 mn, compared to net profit of CHF 221 mn in the same period of 2021. The position in Biogen was fully divested in the first quarter. As of the end of the first quarter, BB Biotech's portfolio consisted of 31 positions. Overall, the portfolio was further concentrated, with the eight largest positions accounting for more than 60% of Net Asset Value. The ranking of portfolio exposure in terms of therapeutic areas is now led by rare diseases followed by oncology and neurology. No new investments were made in the first quarter.

Please find below selected highlights from a few of BB Biotech´s portfolio companies:
 
Ionis (-0.8%, in USD) and its partner AstraZeneca announced on April 14 positive data from the ETESIAN Phase IIb study of ION449, an investigational antisense medicine designed to reduce blood cholesterol levels in patients with hypercholesterolemia by targeting proprotein convertase subtilisin/kexin type 9 (PCSK9). These data were presented at the American College of Cardiology´s 71st Annual Scientific Session & Expo.

Myovant (-30.1%, in USD) and its partner Pfizer announced on April 12 an update on the Supplemental New Drug Application (sNDA) for MYFEMBREE® (relugolix 40 mg, estradiol 1 mg and norethindrone acetate 0.5 mg) for the management of moderate to severe pain associated with endometriosis. In accordance with the ongoing review of the application, on April 6 2022, the FDA provided notice to the companies that the agency identified deficiencies that preclude discussion of labeling and/or post-marketing requirements and commitments at this time. The FDA did not provide additional details. The FDA noted that the letter does not reflect a final decision on the pending sNDA and that the application is still under review. Myovant and Pfizer will continue to work with the FDA to determine next steps with the application.

Vertex Pharmaceuticals (+4.7% in USD) benefited by negative clinical results from its competitor Abbvie for the treatment of Cystic Fibrosis. Similar to Vertex’s Trikafta, AbbVie’s treatment was a three-drug combination meant to correct and regulate the dysfunctional proteins that cause cystic fibrosis. AbbVie had been evaluating this triplet, considered a threat to Vertex’s cystic fibrosis franchise. According to the company, a recent interim analysis of the data found the addition of the third drug (ABBV-119) did not offer a significant improvement on two key health measures for cystic fibrosis patients.

With the significant market corrections we are seeing very attractive valuation levels among the listed biotech companies. The investment team will continue to seek investments in biotech companies that deploy novel approaches to create breakthrough clinical benefits for patients and society.