Our Holdings

0.1%

Achillion Pharmaceuticals

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Achillion Pharmaceuticals

0.1%

Achillion is developing novel complement inhibitors for indications such as paroxysmal nocturnal hemoglobinuria (PNH), C3 Glomerulopathy (C3G), and other diseases where dysfunction of the complement alternative pathway plays a role. The lead compound is ACH-4471, a complement Factor D inhibitor with the potential to provide an oral alternative to Alexion’s blockbuster Soliris, or serve to treat patients who have a suboptimal response to or fail Soliris. Data from an initial Phase I/II trial showed the drug is active, and additional results from ongoing Phase II trials should better determine its potential. In addition, the company is developing ACH-5228, a next-generation Factor D inhibitor that entered the clinic by the end of 2017.

5.1%

Agios Pharmaceuticals

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Agios Pharmaceuticals

5.1%

The two most advanced oncology programs of Agios Pharmaceuticals are targeting

mutations in the isocitrate dehydrogenase 1 and 2 (IDH1 and IDH2) enzymes, which are

implicated in hematologic malignancies and solid tumors. Data with IDH2 inhibitor

Idhifa (AG-221) were compelling and due to the high response rate and well-defined

group of patients who benefited, the drug was given an accelerated approval in August

2017. We estimate the worldwide market opportunity for Idhifa at USD 750 mn for

acute myeloid leucemia (AML). Celgene has worldwide rights to Idhifa, and Agios will

receive milestones and an estimated 15% royalty on sales. Data with IDH1 inhibitor AG-

120 in AML were also promising and an NDA submission was filed end 2017. Results with

AG-120 in rare solid tumors were not as compelling as hoped, and we include little revenue

potential from these indications despite continued development. Finally, the

company is developing AG-348, a novel compound for the treatment of pyruvate kinase

deficiency that reported compelling proof-of-concept data and should lead to the start

for pivotal trials in 2018.

1.6%

Akcea Therapeutics

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Akcea Therapeutics

1.6%

Akcea was spun out of Ionis Pharmaceuticals and is developing antisense drugs to treat rare and severe lipid disorders. Its lead product is Volanesorsen, which has successfully completed Phase III development for familial chylomicronemia syndrome (FCS), a rare and debilitating disease characterized by extremely high triglycerides. Akcea has filed for approval and expects to commercialize the product globally. Akcea also has a pipeline of next generation lipid products based on its LICA technology which allows for much lower dosing and higher potency. ANGPTL3-Lrx is in a Phase I/II study for rare hyperlipidemias and will also be evaluated in fatty liver diseases such as NAFLD and NASH. Akcea has two LICA programs partnered with Novartis for larger diseases, APO(a)-Lrx and APOCIII-Lrx for patients with elevated risk factors for cardiovascular disease. Ionis remains a majority shareholder.

1.0%

Alder Biopharmaceuticals

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Alder Biopharmaceuticals

1.0%

Alder is a clinical-stage company with a differentiated antibody discovery and manufacturing

platform to design and select antibodies that have the potential to maximize

efficacy in various therapeutic indications including inflammatory and neurological

conditions. Their clinical candidate, eptinezumab, is an antibody that inhibits

calcitonin gene-related peptide (CGRP), a well-validated molecular target shown to

trigger migraine attacks. Eptinezumab has recently completed Phase III clinical testing

for the prevention of both chronic and frequent episodic migraines. Data were highly

significant and notable for achieving rapid, robust and durable efficacy. Alder is the

only company with an anti-CGRP asset that is developing a durable, intravenous

formulation to be administered by neurologists in-office – an infusion that could be

given every three months, compared to monthly or biweekly self-administered subcutaneous

injections at home. The company expects to apply for FDA approval by the end

of 2018. A self-administration strategy for Eptinezumab to be dosed every three

months is also being developed in addition to two preclinical programs expected to

enter the clinic in the future.

4.6%

Alexion Pharmaceuticals

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Alexion Pharmaceuticals

4.6%

Alexion is developing drugs for rare disorders. Its lead product Soliris was approved in

the US and Europe in 2007 for paroxysmal nocturnal hemoglobinuria (PNH) and we

expect sales in PNH to reach about USD 2.0 bn. Atypical hemolytic uremic syndrome

(aHUS) is the next indication for which Soliris gained approval in the US and Europe

in 2011. We estimate it adds another USD 2.0 bn market opportunity for Soliris. Other

indications such as myasthenia gravis and neuromyelitis optica could add an additional

USD 1.0 to 2.0 bn in sales. To maintain its dominance, Alexion is in advanced

development with a next-generation Soliris, ALXN-1210, which has an improved dosing

profile and should report Phase III results in H1 of 2018. To diversify the revenue base

away from Soliris, the company received approval of a novel compound for hypophosphatasia,

Asfotase Alfa, in March 2015 and sales to date have exceeded expectations.

In addition, Alexion gained Kanuma for lysosomal acid lipase (LAL) deficiency via its

May 2015 acquisition of Synageva for USD 8.4 bn, and while the launch has been slow,

the product should eventually be a more meaningful contributor to revenue.

3.1%

Alnylam Pharmaceuticals

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Alnylam Pharmaceuticals

3.1%

Alnylam Pharmaceuticals is the market leader in RNA interference (RNAi) therapeutics. This treatment approach selectively blocks the synthesis of specific disease-causing proteins. Alnylam has a broad pipeline of candidates, including five programs that have advanced to the clinical development stage. The furthest along the pipeline currently awaiting regulatory approval is Patisiran which targets TTR amyloidosis, a rare and serious disorder in patients diagnosed with familial amyloidotic polyneuropathy (FAP). Other interesting programs include Fitusiran, which pursues a revolutionary approach in the treatment of hemophilia and rare bleeding disorders, and Givosiran for the treatment of acute hepatic porphyrias. Both RNAi therapeutics are currently in Phase III development. Alnylam continues to support its collaboration with The Medicines Company in their advancement of inclisiran into Phase III studies which investigates RNAi disruption of PCSK9 for the treatment of hypercholesterolemia. Data thus far have been supportive of a once-quarterly and possibly biannual subcutaneous dose regimen which has obvious advantages over recently approved PCSK9 antibody therapies.

1.0%

Argenx

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Argenx

1.0%

Argenx is a Belgian clinical stage small cap biotechnology company developing targeted antibody therapies through its multiple antibody platforms. The company has a variety of mid-to-late stage clinical drug candidates with ARGX-113 being the lead asset. This molecule is currently in the clinics in three IgG-mediated autoimmune diseases with important clinical trial read-outs expected in the coming 12 months. Additionally a second proprietary drug candidate, ARGX-110 is expected to move to proof-of-concept clinical trial in 2018 in in Acute Myeloid Leukemia. A solid balance sheet and experienced management rounds the company’s profile. Argenx can be considered an antibody platform company targeting novel scientific pathways in indications with high unmet medical need with little competition and innovation in the last decades.

7.2%

Celgene

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Celgene

7.2%

Celgene specializes in oncology and inflammatory diseases and has very strong

fundamentals and positive long-term prospects based on products such as Revlimid,

Pomalyst, Otezla and its robust pipeline of early-stage products. We expect Revlimid

US revenue to continue to grow more than 15% per year, driven by the combined effects

of increased prevalence, penetration, duration of treatment. The company’s acquisition

of Receptos broadened their immunology and inflammation franchise beyond

Otezla by gaining access to ozanimod which we expect to be approved in MS this year

and continues to be developed for inflammatory bowel disease (IBD). We expect positive

news flow from both Celgene and their partners’ products in a variety of novel

cancer combinations and settings over the next two to three years. Celgene now appears

to be rapidly moving toward immuno-oncology by recently gaining partial rights

to Durvalumab from AstraZeneca for hematologic malignancies as well as their strategic

collaborations with Juno and Bluebird to develop T-cell-based therapies for cancer

and autoimmune diseases. The company continues to make strategic deals to bolster

its pipeline with promising opportunities.

0.3%

Cidara Therapeutics

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Cidara Therapeutics

0.3%

Cidara is a biotechnology company focused on treating severe and resistant microbial

infections. Its lead product, Rezafungin (in a Phase II study for candidemia and invasive

candidiasis), is from the echinocandin class of antifungals but is dosed as a once-weekly

infusion, versus daily for the current echinocandins. This would provide the option of

treating patients with the best antifungal on an outpatient basis, thus offering significant

advantages to both patients and the healthcare system. Initial Phase I data have

demonstrated a strong safety profile and confirmed the once-weekly dosing potential.

Data read-out is expected in early 2018. Following a constructive meeting with the FDA,

a smaller than expected Phase III study will begin in 2018, along with a prophylaxis

study in bone marrow transplant. Finally, Cidara is the only company developing an immunotherapy

platform for serious infections.

3.4%

Esperion Therapeutics

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Esperion Therapeutics

3.4%

Esperion Therapeutics is focused on the development of treatments for cardio-metabolic

diseases. ETC-1002 is the only clinical asset and has completed multiple clinical

trials and has now initiated its complete Phase III program. ETC-1002’s main target

ATP citrate lyase is located upstream of where statins work and ultimately

reduces LDL cholesterol by upregulation of the LDL receptor. ETC-1002 has shown LDL

cholesterol reduction levels of up to 30% as monotherapy and up to 50% in combination

with ezetimibe. In contrast to the recently approved subcutaneously administered

PCSK9 antibodies, ETC-1002 poses a convenient and more economic once-daily

oral solution. To date ETC-1002 has not shown any significant safety signals such as

statin-typical myalgia. Primary markets for ETC-1002 will be the statin-intolerant

population as well as additional treatment for patients whose LDL cholesterol levels

are not sufficiently controlled with a statin. Phase III monotherapy and fixed-dose

combination trial read-outs are due from Q2 to Q4 2018 and regulatory submissions

are expected by year-end 2018/early 2019.

0.6%

Exelixis

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Exelixis

0.6%

Exelixis is a biotechnology company focused on oncology. The company has one of the most potent tyrosine kinase inhibitors (TKI) on the market. Cabozantinib is approved for the treatment of all stages of renal cell carcinoma (RCC; kidney cancer). Additionally, a Phase III study in 2nd-line hepatocellular carcinoma (HCC; liver cancer) was stopped early due to a positive survival benefit, and we expect this new indication to add incremental value to the cabo franchise. Cabo is also approved for Medullary Thyroid Cancer. Importantly, the drug is being tested in various tumor settings with immune-oncology agents, which can add further, substantial value. Exelixis partnered a second TKI, cobimetinib, with Roche and is approved for the treatment of metastatic melanoma. Finally, having reached profitability, Exelixis is now at a point where it can invest more aggressively in its internal pipeline, which should create value in the future.

0.4%

Five Prime

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Five Prime

0.4%

Five Prime has a discovery platform that includes a library of over 5700 human extracellular proteins, generated by a proprietary technology that enables the capture of cDNAs with intact 5 prime ends. I It also has developed a range of proprietary screens and characterization tools, including automated cell-based screening systems and a rapid in vivo protein production system, to take advantage of its library and overcome limitations of traditional protein screening methods. Via this platform, the company has isolated the 700 proteins that drive immune cell interactions. The key drug in development is FPA008, a humanized IgG4 anti-CSF1R (macrophage colony stimulating factor) antibody. The lead indication for FPA008 is pigmented villonodular synovitis (PVNS), a macrophage-driven tumor. The company began a Phase II trial in May 2016 and we expect more data in mid-2018. The larger potential for FPA008 is as a combination partner with other immuno-oncology agents. A Phase I/II trial investigating FPA008 as a single agent and in combination with Bristol-Myers’ Opdivo is ongoing, and first results from the combination portion showed promise in pancreatic cancer. More data in other solid tumor types are expected in 2018. The company is also developing FPA144, a proprietary ADCC-engineered antibody that inhibits FGFR2b. We expect the start of a Phase III trial in gastric cancer in 2018.

0.4%

G1 Therapeutics

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G1 Therapeutics

0.4%

G1 Therapeutics is a clinical stage small cap biotechnology company focused on the discovery and development of cancer treatment therapeutics. The company has two distinct clinical-stage selective inhibitors of cyclin-dependent kinases 4/6 (CDK4/6i) in its pipeline, trilaciclib and G1T38, both being evaluated in combination with multiple regimens. Whereas trilaciclib could become the first CDKi to be used as a myelosparing agent the second asset, G1T38, is a fast follower and with a potential differentiated PK/PD profile than the other currently approved drugs of this class. The strong scientific rationale coupled with the available clinical data and the proven mode of action gives us confidence that the upcoming multiple read-outs in several indications over the coming 12 months for both assets will confirm their clinical profile.

4.6%

Gilead

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Gilead

4.6%

Gilead develops drugs primarily for infectious diseases such as HIV, hepatitis B, and

hepatitis C, as well as cancer. The first product, Viread, was launched in 2001 and is

now firmly established as a key component in treatment regimens for HIV. Most recently,

it launched regimens that include a replacement for Viread with a better longterm

safety profile, which should enable it to maintain its leadership when Viread

goes generic. The introductions of Hepsera and Viread established Gilead as an important

player in the treatment of hepatitis B infection. Gilead acquired Pharmasset in

early 2012, which enabled it to become the market leader in the USD 20+ bn hepatitis

C (HCV) space. Indeed, sales of its lead products, Sovaldi and Harvoni, reached over

USD 12 bn in the first nine months of 2016. However, this was followed by a precipitous

decline, and we expect a continued decline in future years due primarily to pricing and

competition. To offset the declining HCV sales, the company purchased Kite Pharmaceuticals,

a leader in CAR-T therapy, in October 2017. The first product, Yescarta, was

approved in October 2017 for diffuse large B-cell lymphoma (DLBCL) and we expect

label expansions for other hematologic indications to follow.

3.8%

Halozyme Therapeutics

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Halozyme Therapeutics

3.8%

Halozyme Therapeutics is a biopharmaceutical company with two platforms in its

business model. The first is based on partnerships with pharmaceutical companies

that use its product rHuPH20 to prepare subcutaneous formulations of intravenous

therapies. The company receives a steady flow of royalties from this arm. Partnered

products include blockbusters like Avastin and Rituxan as well as newer products such

as PCSK9 and Daratumumab. The second platform is PegPH20, which is being tested

in the treatment of pancreatic cancer and lung cancer. A Phase III study in pancreatic

cancer has started enrollment in the first half of 2016 and is expected to read out on

PFS by year end 2018. PegPH20 is also being tested in combination regimens with

Keytruda in NSCLC/GC as well as in various tumor types in combination with Roche’s

Tecentriq.

6.9%

Incyte

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Incyte

6.9%

Incyte is focused on hematologic disorders, inflammatory disorders, and cancer. Their

marketed product is Jakafi, an oral JAK-2 inhibitor, that received approval in 2011 and

2014, respectively. We estimate that myelofibrosis and polycythaemia vera (PV) represent

a USD 3+ bn market opportunity in the US and Europe. Phase III trials in graft

versus host disease (GvHD) are also ongoing and could add another USD 500+ mn in

sales if positive in 2018. In November 2009, Novartis licensed ex-US rights to Jakafi i. A

second-generation JAK-2 inhibitor, Baracitinib, posted positive data from several Phase

III trials in rheumatoid arthritis in 2015 and we expect launch into this large market by

2019. Incyte will receive royalties from partner Eli Lilly. Progress on other cancer compounds

in its pipeline, including IDO inhibitor Epacadostat, also continues. Indeed,

encouraging early results with the combination of Epacadostat and Merck and Bristol-

Myers’s PD1 inhibitors, Keytruda and Opdivo, in multiple tumor types have been reported.

Data from a Phase III trial in melanoma patients are due in H1 of 2018. The

company started additional Phase III trials in indications such as lung and head and

neck cancer by the end of 2017.

1.3%

Intercept Pharmaceuticals

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Intercept Pharmaceuticals

1.3%

Intercept Pharmaceuticals is focused on the development of synthetic bile acid analogs for the treatment of cholestatic liver diseases. This disease area primarily includes the highly prevalent non-alcoholic fatty liver disease (NAFLD) and non-alcoholic steatohepatitis (NASH) as well as the orphan diseases primary biliary cirrhosis (PBC) and primary sclerosing cholangitis (PSC). Intercept’s lead product is obeticholic acid (OCA), a firstin- class farnesoid X receptor (FXR) agonist. OCA has been approved in the US and Europe in 2016. As a second and commercially far more attractive indication, Intercept also started a pivotal trial for NASH. Results from this trial are expected to be published in H1 of 2019. NASH, being an obesity and metabolic syndrome-linked disease, has the potential to take on epidemic proportions in western and emerging societies over the coming years. It is projected to be the leading cause of costly liver transplants and liver cancer by 2020. With currently no drug approved, there clearly is an unmet medical and health economic need for new treatments. Intercept’s OCA is the drug furthest in development for NASH and the first to show an anti-fibrotic effect in the liver.

1.1%

Intra-Cellular Therapies

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Intra-Cellular Therapies

1.1%

Intra-Cellular Therapies is a biopharmaceutical company developing treatments for

disorders that affect the central nervous system. Their wholly owned lead product candidate

is ITI-007, or Lumateperone, a 5-HT2A serotonin receptor antagonist that also

modulates dopamine and serotonin transporters, which recently completed two

Phase III clinical trials for the treatment of schizophrenia. Lumateperone could prove

highly differentiated from other anti-psychotics due to its ability to modulate multiple

neurotransmitter pathways simultaneously. This was demonstrated in their first

pivotal Phase III trial which showed strong efficacy and placebo-like safety. Tolerability

and compliance on current schizophrenia therapies is challenging due to a range of

motor and metabolic side effects, which is where Lumateperone has proven to be

differentiated. Intra-Cellular is also evaluating Lumateperone in two Phase III trials for

the treatment of bipolar depression to be completed during the second half of 2018,

while another pivotal study investigating agitation in patients with dementia, including

Alzheimer’s disease, will read out by the end of 2018. The company also has a

PDE inhibitor, ITI-214, in Phase I trials evaluating its role in Parkinson’s disease and

other indications.

9.9%

Ionis Pharmaceuticals

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Ionis Pharmaceuticals

9.9%

Ionis Pharmaceuticals is the leader in the space of antisense, with over 30 compounds

in development using this technology. Antisense allows for the control of protein production

at the genetic level. Our focus and investment strategy revolve around the

technology platform, which demonstrated significant progress in 2017 with both partnered

and proprietary compounds across various severe diseases. Spinraza (partnered

with Biogen) was approved in late 2016 following two positive Phase III studies in

spinal muscular atrophy, and had a very strong launch throughout 2017. Inotersen, for

familial amyloid polyneuropathy, produced positive Phase III data and has been filed in

the US and EU. Additionally, Ionis’ wholly-owned subsidiary, Akcea, completed a successful

IPO and has filed Volanesorsen in the US and EU for familial chylomicronemia

syndrome. Our focus going forward is on the company’s next generation technologies

such as 2.5 and LICA. Thus, Ionis remains an important and truly innovative investment

in our portfolio.

1.5%

Macrogenics

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Macrogenics

1.5%

Macrogenics has multiple compounds in clinical development that were generated using its propriety Fc-optimization technology that simultaneously reduces resp. enhances binding to inhibitory resp. activating FcyRs, thus dramatically increasing antibody-dependent cellular cytotoxicity (ADCC), and its DART (dual-affinity re-targeting)platform. The company believes its DART platform has overcome the challenges of construct instability and short half-lives encountered by other dual-specific antibodies by incorporating proprietary covalent disulfide linkages and particular amino acid sequences that efficiently pair the chains of the DART molecule. This results in a structure with enhanced manufacturability, long-term structural stability, and the ability to tailor the half-lives of the DARTs to their clinical needs. Data from clinical trials with multiple products, including immuno-oncology agent MGA271, are expected through 2018.

1.9%

Moderna Therapeutics

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Moderna Therapeutics

1.9%

Moderna Therapeutics is a Boston-based private biotech company, which is pioneering a new class of medicine made of messenger RNA. Since their founding Moderna has been able to raise more than USD 2.5 bn in financing from investors and partners. A substantial amount of this capital was invested in what is now a leading mRNA technology platform in order to be able to quickly drive development candidates into the clinic on a broad front of therapeutic and prophylactic applications. Their pipeline now includes 19 development candidates, with 10 of them in the clinic, for mRNA-based vaccines and treatments in diverse therapeutic areas. The in our view key programs that will be reading out clinical data within in the next few years include the rare liver disease MMA and PPA, the proprietary vaccines in congenital CMV and hMPV+PIV3, the intra-tumorally injected cytokine cocktail OX40L+IL23+IL36 gamma, the personalized cancer vaccine and early data on the VEGF Phase 2 during CABG-surgery.

2.2%

Myovant Sciences

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Myovant Sciences

2.2%

Myovant is a biopharmaceutical company with a focus on endocrinology in women’s

and men’s health. Its lead candidate, Relugolix, is an oral GnRH antagonist in Phase III

development for three indications, endometriosis, uterine fibroids, and advanced

prostate cancer. Endometriosis is a condition where part of the endometrium grows

outside of the uterus leading to severe pain, painful intercourse, and bleeding. Uterine

fibroids is a condition that can lead to painful menstruation and excessive bleeding,

and potentially surgical removal of the uterus. Advanced prostate cancer is cancer of

the prostate that continues to grow despite castration and/or radiation. Partner

Takeda announced positive data from two Phase III trials in uterine fibroids in

Japanese women, further validating Relugolix’s mechanism of action. We expect data

from all three Phase III trials in the US in 2019. Myovant owns worldwide rights outside

of Asia.

0.7%

Myokardia

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Myokardia

0.7%

Myokardia is one of only a few small biotech companies in the cardiovascular disease area. The company’s initial focus is on the treatment of inheritable cardiomyopathies, a group of rare, genetically-driven forms of heart failure that result from biomechanical defects in cardiac muscle contraction. The most advanced pipeline asset is MYK-461 (mavacamtem), an allosteric inhibitor of cardiac beta myosin function that is being investigated in obstructive hypertrophic cardiomyopathy (oHCM or HoCM). The company posted intriguing Phase II results not only showing direct improvement in biomarkers (up to 15% reduction in ejection fraction, up to 90% reduction in LVOT gradient) but also an increase of up to 17% in exercise capacity and an improvement in symptoms (1 Class NYHA improvement on average). A single Phase III trial aiming at exercise capacity and symptom improvement has been initiated with an expected read-out in 2020. Further studies include a Phase II study in non-obstructive HCM as well as early dose escalation data in H2-18 for their second asset (MYK-491) that is being developed for DCM (dilated cardiomyopathy).

0.7%

Nektar Therapeutics

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Nektar Therapeutics

0.7%

Nektar Therapeutics is focused on developing novel drugs for oncology, autoimmune disease, and chronic pain. The most important product in their pipeline is NKTR-214, a CD122-biased agonist designed to stimulate the patient’s own immune system to fight cancer. NKTR-214 is designed to support the growth of specific cancer-killing T cells (CD8+) and natural killer (NK) cell populations in the body. CD122, which is also known as the Interleukin-2 receptor beta subunit, is a key signaling receptor that is known to increase proliferation of these effector T cells. In early clinical trials, treatment with NKTR-214 results in a rapid expansion of these cells and mobilization into the tumor micro-environment. BB Biotech began building a position after investors were initially disappointed by imperfect data updates at the ASCO conference. It is looking forward to more data read-outs which it believes will define the ultimate treatment benefit for this promising and novel technology.

8.9%

Neurocrine Biosciences

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Neurocrine Biosciences

8.9%

Neurocrine is a biopharmaceutical company with a focus on women’s health and CNS

disorders. Its lead candidate, Elagolix, is an oral GnRH antagonist in development for

two indications, endometriosis and uterine fibroids. Endometriosis is a condition

where part of the endometrium grows outside of the uterus leading to severe pain,

painful intercourse, and bleeding. Uterine fibroids is a condition that can lead to painful

menstruation and excessive bleeding, and potentially surgical removal of the uterus.

Partner AbbVie has filed for approval in endometriosis. AbbVie is also conducting

a Phase III program in uterine fibroids, with data expected in early 2018. Neurocrine

received approval for Ingressa (Valbenazine) for tardive dyskinesia in mid-2017 and

launched the product in the US. The company has also initiated a Phase II dose-escalation

study in pediatric Tourette syndrome with data expected in 2018.

0.3%

Novavax

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Novavax

0.3%

Novavax is a company specializing in the development of novel vaccines. The most

advanced program is a vaccine to prevent RSV infections in infants and older adults.

Respiratory syncytial virus (RSV) is a respiratory tract infection which may be fatal in

infants, older adults, and people with compromised immune systems. In a Phase II

study in older adults, Novavax showed that its vaccine results in 44% fewer symptomatic

RSV infections and a more than 60% reduction in severe RSV infections. However,

in 2016, the company announced that the Phase III study in the elderly failed due to a

much lower event rate than expected. In its Phase II study in pregnant women,

Novavax showed that theantibodies are transferred effectively from the mothers to

their infants. A corresponding Phase III study has been initiated in pregnant women

with data expected in H2 of 2018. Novavax also has a seasonal influenza vaccine, an

Ebola vaccine, and a pandemic influenza vaccine in its pipeline.

2.9%

Novo Nordisk

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Novo Nordisk

2.9%

Novo Nordisk is a leader in the global diabetes market. Novo’s once-weekly GLP-1 analogue,

Ozempic (semaglutide SQ), has been approved in the US in December 2017 for

type 2 diabetes and will be a significant growth driver for the company. A clean label

and a superior data set should allow for a very competitive profile. Additionally, we

expect oral semaglutide to garner more attention as we will see Phase III data start to

emerge in 2018. This compound, if successful, would be the most efficacious oral antidiabetic

drug ever approved. Tresiba’s launch has been going well and should help

drive Novo Nordisk’s long-term penetration in the modern insulin space. Victoza (daily

SQ GLP-1) continues to grow. In 2016, Novo refined its long-term growth expectations

downward, as the entire insulin market is facing pricing headwinds in the US, which is

now reflected in current estimates.

0.1%

Probiodrug

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Probiodrug

0.1%

Probiodrug is a biotechnology company, located in Halle, Germany, focused on the

development of innovative small molecule drugs for the treatment of Alzheimer’s disease

(AD). The company holds a dominant position in the area of glutaminyl cyclase

(QC) inhibition. The role of QC in AD and other inflammatory diseases was discovered,

and is comprehensively IP-protected, by Probiodrug. A Phase I study with its lead compound,

PQ912, is complete, demonstrating a clean safety profile and initial target inhibition.

A Phase II study recently demonstrated target engagement along with other

biomarker signals in mild AD patients. The company was founded in 1997, and pioneered

the field of DPP4 inhibition for the treatment of type 2 diabetes. Probiodrug

sold its DPP4 franchise to OSI Pharmaceuticals in 2004. Probiodrug’s pioneering scientific

approach targeting QC in AD has the potential to bring a breakthrough treatment

to this therapeutic area of great, unmet need.

5.0%

Radius Health

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Radius Health

5.0%

Radius Health is a company focused on women’s health and oncology. Its lead product

candidate is the subcutaneously delivered Abaloparatide, a synthetic human PTHrP

analogue. The faster onset of action and reduction in fractures in nonvertebral sites

like the hip and wrist versus Forteo are differentiating and should allow Abaloparatide

to capture significant market share. Radius received approval in early 2017, and we

expect 2018 to be heavily focused on market access and reimbursement. Importantly,

Radius is developing a transdermal patch formulation, which could greatly enhance

the outcomes in women with this disease. Transdermal data presented in 2016 showed

a meaningful improvement in its profile, and we expect a pivotal study to begin in

2018. Furthermore, the company has RAD1901, a selective estrogen receptor degrader

(SERD), in development for estrogen-receptor-positive breast cancer. Following a

meeting with the FDA, a potential registrational study will start in 2018.

2.6%

Regeneron Pharmaceuticals

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Regeneron Pharmaceuticals

2.6%

Regeneron is focused on developing monoclonal antibodies. The blockbuster success

of Eylea, a VEGF inhibitor indicated for ophthalmic disorders, has been the primary

driver of growth for the company. We expect near-term growth to continue in 2018 as

Eylea gains broader adoption in wet AMD and expands into DME. Regeneron holds

a partnership with Bayer Healthcare for the development, marketing, and sale of Eylea

outside of the US. Regeneron also holds a partnership with Sanofi, with whom they

have commercialized three products thus far and, more importantly, have a deep pipeline

of assets the two partners are co-developing. Praluent for hypercholesterolemia is

approved by the FDA for heterozygous familial hypercholesterolemia or clinical atherosclerotic

cardiovascular disease patients who need additional lowering of LDL cholesterol.

Kevzara and Dupixent have recently been approved for rheumatoid arthritis and

atopic dermatitis, respectively. With Teva and Mitsubishi Tanabe, the company is also

developing Fasinumab, an antibody to nerve growth factor for pain therapy. Regeneron

also has collaboration agreements with Intellia Therapeutics to advance CRISPR/Cas

gene-editing technology. 

4.6%

Sage Therapeutics

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Sage Therapeutics

4.6%

Sage Therapeutics is a clinical-stage biopharmaceutical company focused on developing

therapies for rare CNS disorders utilizing their GABA-A receptor-targeted proprietary

platform. The company’s lead program, Brexanolone, is in Phase III development

as an IV treatment for post-partum depression (PPD). Brexanolone has shown rapid

and durable efficacy with excellent tolerability, which sets it apart from all classes of

drugs currently used in the field of depression and mood disorders. An oral,

follow-on version of brexanolone, SAGE-217, has also recently shown significant early

clinical success in a Phase II trial in major depressive disorder (MDD), while a Phase II

study in PPD is due to read out later this year. SAGE-217 is also being investigated in

essential tremor and Parkinson’s disease. Sage also has an NMDA program with SAGE-

718 in Phase I, targeting several orphan neurological indications.

3.0%

Tesaro

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Tesaro

3.0%

The first marketed product of Tesaro, Rolapitant, is a neurokinin-1 (NK-1) receptor

antagonist that completed Phase III trials for the prevention of chemotherapy induced

nausea and vomiting (CINV) in 2014. The results were positive and approval in the US

was received in September 2015. Niraparib is a PARP inhibitor that had shown promising

efficacy in patients with BRCA+ breast and ovarian cancer in early trials. In 2016, the

company announced highly positive results from a Phase III trial in platinum-sensitive

ovarian cancer and approval with a broad label was granted in 2017. Multiple additional

trials designed to expand Niraparib’s potential in ovarian and other cancers are

underway, and some data will be available in 2018. Meanwhile, the company inlicensed

several compounds that gave them an entry into the immuno-oncology

space, and clinical trials with those targeting PD1, TIM-3, and LAG-3 are progressing

and should yield results in 2018.

6.5%

Vertex Pharmaceuticals

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Vertex Pharmaceuticals

6.5%

Vertex’s core focus is cystic fibrosis. CFTR potentiator Kalydeco was launched in the US

and Europe in 2012 for a subgroup of patients with cystic fibrosis. While the initial

market opportunity is limited to around 5% of the patient population, we believe that

sales could reach USD 1.0 bn with the inclusion of other small patient populations on

the label. Positive Phase III results with the combination of Kalydeco and CFTR corrector

VX-809, released in June 2014, enabled Vertex to begin to target the roughly 45% of

patients who are homozygous for the most common mutation in the US and Europe in

2015. With this label inclusion, we expect sales of Kalydeco and the Kalydeco/VX-809

combination to reach approximately USD 4 bn. The company is also developing correctors

that can be combined with Kalydeco and VX-661 to target the remaining patients

who are heterozygous for the mutation. Data from Phase II trials announced in 2017

were highly positive and we expect Phase III trials to start in H1 of 2018 with approval

to follow by 2020.

1.4%

Voyager Therapeutics

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Voyager Therapeutics

1.4%

Voyager is a clinical-stage biotech company focused on developing novel genetically

targeted therapies to treat CNS diseases. The company’s lead asset, VY-AADC is an

AAV-based gene therapy with the objective of increasing the expression of the enzyme

responsible for converting levodopa to dopamine (AADC, L-amino acid decarboxylase)

in the brains of advanced Parkinson’s disease patients. VY-AADC is currently

in Phase Ib with pivotal studies scheduled to begin in 2018. The company is also developing

other AAV vectors targeted at increasing expression of a key gene in Friedreich’s

ataxia, delivering monoclonal antibodies, or silencing/knocking down genes using

microRNA delivery in diseases like monogenic SOD1 familial ALS and Huntington’s disease.

Voyager’s discovery engine has generated programs in five CNS indications, and

in the next 18 to 24 months, they plan to initiate at least three other clinical programs.

1.2%

Wave Life Sciences

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Wave Life Sciences

1.2%

Wave is a leader in the space of stereochemistry, with an initial focus on antisense

oligonucleotides (ASOs) and exon skipping. In simple terms, stereochemistry refers to

the three-dimensional structure of a molecule and how this affects its chemical

properties. Current ASOs can contain hundreds to hundreds of thousands of various

enantiomers (stereomixture), many of which do not contribute to efficacy, but could

be causing toxicity. Wave is able to specifically design their individual molecules

(stereopure) to contain the desired properties, thus potentially enhancing potency and

minimizing toxicity. The company’s lead product is in Phase I/II development for

Huntington’s disease and targets very specific point mutations in order to knock down

the mutant protein. We expect data in early 2019. Wave’s second program recently

entered Phase I development for Duchenne muscular dystrophy (DMD) and acts by

skipping exon 51. Initial data are expected in the third quarter of 2018.

All comments as at December 31, 2017 or beginning of investment.

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Media releases / 20.07.2018

BB Biotech shares hold steady in the second quarter