Intl Biotec (LON:IBT) is a long-established specialist fund investing in listed (c 90%) and unlisted (c 10%) companies in the high-growth area of biotechnology. After several years of strong absolute returns, the past six months have seen a sell-off in the sector, arguably sparked more by political pressure and investor risk aversion than by company fundamentals. While a resumption of bull market conditions is uncertain in the near term, the demographic factors and scientific advances underlying innovation in the sector remain favourable. IBT aims to out-perform the benchmark NASDAQ Biotechnology index and has done so in NAV total return terms over one, three and six months, one and three years and since lead manager Carl Harald Janson took over in September 2013.
Investment strategy: Risk-aware pursuit of growth
IBT has two investment portfolios. In the quoted portfolio, managers Carl Harald Janson and Ailsa Craig at SV Life Sciences (SVLS) take a risk-aware approach to identifying attractively valued companies that are addressing areas of unmet medical need, with strong intellectual property, experienced management and sound financing. An unquoted portfolio (c 10% of assets), run by SVLS managing partner Kate Bingham, provides exposure to earlier-stage companies that have largely been started or incubated in SVLS’s venture funds. IBT invests in 60-90 companies but a large proportion of assets (50%+) is in the top 10 holdings.
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