BB Biotech (DE:BIONn) (BION) is a Switzerland-based closed-end fund focusing on the high-growth opportunities available in the global biotechnology space. Founded in 1993 by industry specialist Bellevue Asset Management, BION holds a concentrated (c 30–35 stocks) portfolio of biotech names, which are diversified across a range of clinical focuses. The fund’s strong record of NAV outperformance versus the headline NASDAQ Biotechnology index has suffered a setback in the past 12 months. However, the managers remain optimistic on medium-term clinical catalysts and have recently refreshed the portfolio with a number of new holdings. BION has a policy of paying c 5% of its share price annually as a dividend, which, along with a shift in the shareholder base to include more long-term investors and fewer discount players, has supported a strong re-rating in the shares. The fund has traded at an average 7.1% premium to NAV in the past 12 months.
Investment strategy: Clinical and financial focus
BION is managed by a team of six life-science specialists, headed by Dr Daniel Koller. The team builds a concentrated, high-conviction portfolio selected from a global universe of c 800 companies, looking for those that blend strong clinical and financial attributes with good management and return potential. Five to eight core holdings typically account for at least 50% of the portfolio.
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