19.01.2018 – 07:29

BB Biotech AG

DGAP-Adhoc: BB Biotech shows a double-digit total return for 2017 - mid caps overdeliver on innovation and are becoming a key upside trigger

DGAP-Ad-hoc: BB BIOTECH AG / Key word(s): Profit Warning
BB Biotech shows a double-digit total return for 2017 - mid caps overdeliver on
innovation and are becoming a key upside trigger

19-Jan-2018 / 07:00 CET/CEST
Disclosure of an inside information acc. to Article 17 MAR, transmitted by DGAP
- a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Media release as of January 19, 2018

Portfolio of BB Biotech AG as of December 31, 2017

BB Biotech shows a double-digit total return for 2017 - mid caps overdeliver on
innovation and are becoming a key upside trigger

5% dividend yield maintained - BB Biotech management remains confident in the
sector's prospects in 2018

With a total return for BB Biotech's shareholders of 23.1% in CHF and 13.1% in
EUR buoyed by the euro's substantial appreciation against the dollar, BB Biotech
delivered a strong performance in 2017. The underlying portfolio performed well,
ending the year up 23.4% in CHF, 12.5% in EUR and 29.2% in USD - which is 7.5%
ahead of the Nasdaq Biotech Index (NBI). Consolidated, but not yet audited, full
year 2017 data showed a net gain of CHF 688 mn compared to a net loss of CHF 802
mn for full year 2016. A volatile fourth quarter saw a 4% decline in the value
of the portfolio, in line with the sector, and declined only 1% to the BB
Biotech share price in CHF. Continuing the 5% dividend policy based on the
average December 2017 share price, BB Biotech will propose a record regular
dividend of CHF 3.30 per share at the AGM.

Multiple product approvals for 2017
While broad benchmarks such as the Dow Jones (11% in USD), the Nasdaq Composite
(7% in USD), the DAX (1% in EUR) and the SMI (2% in CHF) extended 2017 gains in
the fourth quarter, the Nasdaq Biotech Index (NBI) lost around 4% in USD in the
same period. Fourth quarter volatility for larger cap biotechnology companies
led to significant, short-term devaluation. In contrast, smaller and mid cap
biotechnology companies continued to grow based on positive clinical trial
results and solid product launches.

The US FDA approved 12 new drugs in the fourth quarter 2017, bringing the total
number of approvals for the year to 46, more than in any of the previous 20
years. The majority of these approvals were granted to biotechnology companies.
For the year, the NBI saw a total return of 21.7% in USD, somewhat behind the
total returns of broad US sectors such as the Nasdaq Composite (29.7%) and the
Dow Jones Index (28.1%) in USD. Fund flows for the biotech sector were negative
in the last quarter, reflecting the cautious stance of generalist investors. BB
Biotech believes that this creates potential for fund inflows as sector
fundamentals continue to improve in 2018.

BB Biotech's development in the fourth quarter and in FY 2017
For 2017, BB Biotech's total share return of 23.1% in CHF and 13.1% in EUR was
built on the strong portfolio performance. Strengthening of the EUR over the USD
was a major headwind for EUR denominated performance. The portfolio Net Asset
Value (NAV) increased by 23.4% in CHF, 12.5% in EUR and 29.2% in USD in the same
period.

For the fourth quarter, BB Biotech's share price declined modestly (-0.8% in
CHF, -2.3% in EUR). The portfolio NAV decline was -4.2% in CHF, -6.3% in EUR and
-4.8% in USD. Consolidated, but not yet audited, fourth quarter 2017 data
indicate a net loss of CHF 156 mn versus last year's loss of CHF 24 mn.
Consolidated, but not yet audited, full year 2017 data showed a net gain of CHF
688 mn compared to a net loss of CHF 802 mn for full year 2016.

A proposed dividend of CHF 3.30 per share
The Board of Directors will propose a record regular dividend of CHF 3.30 per
share at the general assembly on March 13, 2018. This is computed as a 5%
dividend yield applied to the average share price during December 2017 -
consistent with the dividend policy introduced in 2013.

Portfolio adjustments in the fourth quarter
In the fourth quarter, the remaining holding in Swedish Orphan Biovitrum (SOBI)
was sold - thereby closing out a highly profitable holding initiated in early
2011 which realized a 3-fold return on total capital invested. In the large cap
segment, profits were taken in Novo Nordisk following its strong recovery and
the cash was reinvested in Celgene during a significant sell-off in late
October. In the smaller and mid cap segments, BB Biotech bought additional
shares of Radius Health, Macrogenics, and Esperion and took profits following
the strong performances of Juno Therapeutics, Idorsia and Alnylam. BB Biotech
also invested in Cidara Therapeutics' private placement.

Following management's late year strategic review, new positions were opened in
Wave Life Sciences, Voyager Therapeutics and Akcea Therapeutics. Wave Life
Sciences develops stereo-selective nucleic acid therapeutics with a focus on
severe neurological diseases. Voyager Therapeutics is developing a gene therapy
for advanced Parkinson's disease and Akcea Therapeutics is addressing serious
rare lipid disorders with antisense products.

Outlook - promising 2018 with an expectation for continued product approvals
BB Biotech believes that 2018 will continue to bring important product approvals
and milestones for the sector and for its portfolio. The FDA continues to
improve the efficiency of the drug review process - and candidate drugs which
address serious and unmet medical needs are expected to move through the process
expeditiously.

BB Biotech anticipates continued debate around the US Affordable Care Act. One
major change to the Affordable Care Act was included in the new tax bill which
passed in late 2017 - namely the repeal of the individual mandate - and this
will likely reduce the pool of insured individuals. After 2018, healthy and
younger individuals will be allowed to opt out of healthcare insurance plans
without financial penalty - and this may put pressure on premiums for those
remaining on plan.

As predicted, concerns around drug pricing restrictions by the US government are
sporadic more than systematic. But BB Biotech continues to monitor potential
changes, particularly with the anticipated appointment of Alex Azar as the
Secretary of Health and Human Services. Azar is a former drug company executive
who is considered a pragmatist and pro-innovation and pro-competition actor.

Biotechnology valuations are attractive at current levels. The financial aspects
of the US tax reform bill - including lower corporate tax rates and allowances
for repatriation of ex-US cash may presage both improved and simplified balance
sheets for US large cap pharma and perhaps an uptick in M&A activities in
biotechnology.

More fundamentally, BB Biotech expects the biotechnology sector to grow based on
its ever increasing strengths of innovation and an increasing share of novel
drugs in 2018 and beyond. It looks forward to another productive and exciting
year in 2018. BB Biotech remains dedicated to identifying leading-edge
biotechnology firms developing market dominant drugs based on cutting-edge
technologies.

The complete annual report as of December 31, 2017 will be published on February
16, 2018.

For further information:

Investor Relations
Bellevue Asset Management AG, Seestrasse 16, 8700 Küsnacht, Switzerland, tel.
+41 44 267 67 00
Dr. Silvia Schanz,ssc@bellevue.ch
Maria-Grazia Iten-Alderuccio,mga@bellevue.ch
Claude Mikkelsen,cmi@bellevue.ch

Media Relations
Bellevue Asset Management AG, Seestrasse 16, 8700 Küsnacht, Switzerland, tel.
+41 44 267 67 00
Tanja Chicherio,tch@bellevue.ch

TE Communications AG, Bleichestrasse 11, 9000 St. Gallen, Switzerland, tel. +41
79 423 22 28
Thomas Egger,teg@te-communications.ch

www.bbbiotech.com

Company profile
BB Biotech invests in companies in the fast growing market of biotechnology and
is one of the world's largest investors in this sector. BB Biotech is listed in
Switzerland, Germany and Italy. Its investments are focused on listed companies
that are developing and commercializing novel medical treatments and cures. BB
Biotech's investment selection process is guided by the fundamental research and
analysis of physicians and molecular biologists. Its Board of Directors has many
years of experience in industry and science.

Disclaimer
This release contains forward-looking statements and expectations as well as
assessments, beliefs and assumptions. Such statements are based on the current
expectations of BB Biotech, its directors and officers, and are, therefore,
subject to risks and uncertainties that may change over time. As actual
developments may significantly differ, BB Biotech and its directors and officers
accept no responsibility in that regard. All forward-looking statements included
in this release are made only as of the date of this release and BB Biotech and
its directors and officers assume no obligation to update any forward-looking
statements as a result of new information, future events or other factors.

 

Composition of BB Biotech's portfolio as of December 31, 2017
(in % of securities, rounded values)

                                      

Ionis Pharmaceuticals                11.0%

Celgene                              9.6%

Incyte                               9.4%

Neurocrine Biosciences               7.2%

Vertex Pharmaceuticals               5.9%

Gilead                               5.3%

                                      

Radius Health                        4.9%

Halozyme Therapeutics                4.6%

Sage Therapeutics                    4.6%

Alexion Pharmaceuticals              4.4%

Esperion Therapeutics                4.2%

Agios Pharmaceuticals                4.2%

Novo Nordisk                         3.9%

Alnylam Pharmaceuticals              3.6%

Juno Therapeutics                    2.4%

Tesaro                               2.3%

Regeneron Pharmaceuticals            2.1%

Macrogenics                          1.3%

AveXis                               1.2%

Myovant Sciences                     1.2%

Intra-Cellular Therapies             0.9%

Wave Life Sciences                   0.8%

Intercept Pharmaceuticals            0.8%

Alder Biopharmaceuticals             0.7%

Voyager Therapeutics                 0.7%

Akcea Therapeutics                   0.6%

Five Prime Therapeutics              0.5%

Cidara Therapeutics                  0.4%

Probiodrug                           0.4%

Prothena Corp.                       0.4%

Novavax                              0.3%

Idorsia                              0.2%

Achillion Pharmaceuticals            0.1%

                                      

Radius Health Warrants, 04/23/2018   0.1%

Radius Health Warrants, 02/19/2019   <0.1%

                                      

Total securities                     CHF 3 627.1 mn

                                      

Other assets                         CHF 10.7 mn

Other payables                       CHF (99.1) mn

                                      

Total shareholders' equity           CHF 3 538.7 mn

                                      

                                      

                                      

                                      

                                      
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Language: English

Company:  BB BIOTECH AG

          Schwertstrasse 6

          8200 Schaffhausen

          Switzerland

Phone:    +41 52 624 08 45

E-mail:    info@bbbiotech.com

Internet: www.bbbiotech.ch

ISIN:     CH0038389992

WKN:      A0NFN3

Listed:   Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial
Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart; SIX



 

End of Announcement DGAP News Service

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646529  19-Jan-2018 CET/CEST