Positive biotech sector momentum continues - transformational new products the key driver

23 januari 2014 BB BIOTECH AG / Positive biotech sector momentum continues - transformational new products the key driver . Processed and transmitted by NASDAQ OMX Corporate Solutions. The issuer is solely responsible for the content of this announcement. BB Biotech proposes a tax-efficient cash distribution of CHF 7.00 per share The Nasdaq Biotech Index advanced another 8.3% (in USD) in the fourth quarter, crowning 2013 as one of the best years ever for biotech stocks. Both the top holdings and the more recently established midcap positions in BB Biotech's portfolio performed well. The investment company's shares ended the year with a fourth quarter performance of 10.4% (in CHF) and an annual performance of 66% (in CHF) - 5 percentage points more than the benchmark index. These excellent gains are fundamentally sound and driven in part by new product launches such as Actelion's Opsumit for pulmonary arterial hypertension and Gilead's Sovaldi for hepatitis C. Keeping the payout policy established in 2013, the Board of Directors will propose a cash distribution of CHF 7.00 per share at the upcoming annual general meeting corresponding to a yield of 5%. Positive biotech sector momentum continues The strong upward trend of the biotech sector continued in the fourth quarter of 2013 with the Nasdaq Biotech Index (NBI) gaining 8.3% (in USD), performing in line with the broader S&P 500 Index, which gained 10.5% in the same time. For the 12 months of 2013, the NBI gained 66.0%, twice that of the S&P index (all values in USD including dividends). The continued upward move in the fourth quarter was driven by important product approvals, further progress of key clinical programs and strong third quarter 2013 financial results supporting the strong industry growth trajectory and commensurate valuations. BB Biotech performance for the fourth quarter and 12 months 2013 BB Biotech's performance was driven by growth across the portfolio, both by long term holdings and by midcap holdings that have been built more recently. The share price of BB Biotech once more increased by double digits in the fourth quarter 2013 - adding 10.4% in CHF. The positive fourth quarter contributed to the 12 month 2013 share price appreciation of 66.0% in CHF, 65.6% in EUR and 70.2% in USD, including the cash distribution of CHF 4.50. In the fourth quarter, the Net Asset Value (NAV) increased 5.2% in CHF, 4.8% in EUR and 6.6% in USD - and for the 12 month 2013, the NAV significantly increased 77.0% in CHF, 74.1% in EUR and 81.4% in USD (all values account for the cash distribution of CHF 4.50 per share). Proposed cash distribution for the fiscal year 2013 of CHF 7.00 per share In line with the distribution policy established in 2013, the board will propose a tax-efficient cash distribution of CHF 7.00 per share following the Annual General Meeting (AGM) on March 19th, 2014, applying a 5% yield to the weighted volume average share price in December 2013. Going forward, the cash distribution will be calculated the same way. BB Biotech continued its share repurchase program in the fourth quarter acquiring 130'000 shares through the second trading line for a total CHF 17.8 mn. For 2013, a total of 415'000 shares, of the 1'185'000 approved at the AGM on March 18, 2013, were repurchased. The difference between book value and share price nevertheless widened over the year and the program will continue as planned. Despite the fundamentally strong sector growth and the above average performance of BB Biotech the structured distribution policy will be continued consequently to return capital to the shareholders of 10%. Changes to the team in 2013 In March 2013, Dr. Erich Hunziker became the new Chairman of BB Biotech, after joining the company's board two years ago. Prof. Dr. med. Thomas Szucs did not stand for re-election after ten years of successful chairmanship and board membership. BB Biotech's shareholders elected Prof. Dr. Dr. Klaus Strein as new board member of the company. In the fourth quarter, BB Biotech increased its portfolio management team by one member, adding expertise in the central nervous system (CNS) disease category. With a continued high unmet medical need in many disorders such as Alzheimer, schizophrenia and depression, BB Biotech will research companies to identify potential investment candidates in these areas. Existing portfolio continues to perform well driven by transformational new products reaching the market The fourth quarter performance was driven by further key product approvals for important BB Biotech holdings: * Sovaldi (Gilead), a first in class nucleotide analog polymerase inhibitor for the treatment of hepatitis C Virus (HCV) infected patients, in combination with ribavirin for HCV genotype 2 and genotype 3 infected patients, and in combination with peg-interferons and ribavirin for the treatment of HCV genotype 1 infected patients * Opsumit (Actelion), a novel endothelin receptor antagonist (ERA) for the treatment of PAH, with a differentiated product label compared to the currently marketed ERAs * Imbruvica (Pharmacyclics), a bruton's tyrosine kinase inhibitor for the treatment of patients with mantle cell lymphoma (MCL) who have received at least one prior therapy Key clinical data from Celgene's MM-020 clinical study were presented in mid- December 2013 at the American Society of Hematology (ASH) supporting our projection of significant use of Revlimid in newly diagnosed multiple myeloma patients. In addition to the strong performing large cap positions, Incyte has become a considerable position from the midcap space. The failure of a key JAK competitor in late clinical development, lower competitive pressure for the company and focus on other pipeline opportunities all led to stock price appreciation for Incyte. Important Phase III results are expected in early 2014 for polycythemia vera (PV) patients potentially expanding further the revenue potential for Jakafi. With Incyte and Isis BB Biotech's portfolio now has grown two core positions in the midcap biotech space, as their valuation appreciated in 2013. Smaller adjustments in the fourth quarter of 2013 in a well performing portfolio In the fourth quarter of 2013, turn-over in investments was lower than earlier in the year. The most significant changes to the portfolio were additions to our positions in Pharmacyclics (2.8% of the portfolio), Synageva (2.3%), Regeneron (2.2%) and Neurocrine (1.0%). To finance these acquisitions, we used cash profits from our successful investments in longer term large- and midcap holdings such as Isis, Incyte and Halozyme. Ariad showed a modest recovery in share price following the market re-introduction of Iclusig. This enabled us to reduce our Ariad holding. The management team sold the holdings in Optimer which was acquired by Cubist. We also sold our position in Valneva. Outlook The continued success of BB Biotech will be based on thoughtful, rigorous selection to identify new medications with the potential of becoming innovative standards of care. Assets demonstrating such innovation recently have included the novel single tablet regiment for the treatment of HIV, the IMiDs, such as Revlimid for the treatment of multiple myeloma, or novel oral agents such as Tracleer for the treatment of pulmonary arterial hypertension (PAH). With the recent approval of Sovaldi, we expect a dramatic change in the treatment paradigm for HCV patients. Sovaldi and Gilead's HCV franchise success are expected to be a key driver for further fund flow momentum for the biotech industry as a whole. We would highlight Xtandi for the treatment of prostate cancer, Imbruvica for lymphoma indications such as CLL and NHL and Opsumit for the treatment of PAH as some of the recent product approvals that have blockbuster potential and will help drive the industry higher. Furthermore, new orphan drugs are in late stage clinical development to address rare and severe diseases. Another important area of significant investment for BB Biotech are the platform technologies, such as the RNA based medicines (antisense and RNAi), antibody drug conjugates, small molecule drug conjugates as well as novel delivery approaches for current intravenously administered biologics. 2014 will be another exciting biotech year with many key clinical trial results, further significant product approvals, and possible consolidation in the sector to continue. Despite a rerating observed during the last two years, BB Biotech believes the sector remains attractively valued. Pipelines continue to deliver innovative products, and fundamentals remain strong. BB Biotech continues to expect the sector to perform strongly and to deliver double digit returns to investors. The webcast with Dr. Daniel Koller, Head Management Team BB Biotech, is available on www.bbbiotech.com. The complete annual report as of December 31, 2013 will be published on February 20, 2014. 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 b-public AG, Pfingstweidstrasse 6, 8005 Zürich, Switzerland, tel. +41 79 423 22 28 Thomas Egger, teg@b-public.ch Bellevue Asset Management AG, Seestrasse 16, 8700 Küsnacht, Switzerland, tel. +41 44 267 67 00 Tanja Chicherio, tch@bellevue.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 with more than CHF 2.1 billion in assets under management. 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, 2013 (in % of securities, rounded values) Celgene   14.1% Actelion   11.7% Gilead   11.0% Isis Pharmaceuticals   10.5% Incyte   8.8% Vertex Pharmaceuticals   4.3% Alexion Pharmaceuticals   4.1% Medivation   3.9% Novo Nordisk   3.5% Halozyme Therapeutics   2.9% Pharmacyclics   2.8% Swedish Orphan Biovitrum   2.7% Synageva BioPharma   2.3% Regeneron Pharmaceuticals   2.2% Immunogen   1.9% Theravance   1.3% Glenmark Pharmaceuticals   1.3% Alnylam Pharmaceuticals   1.2% Clovis Oncology   1.2% Endocyte   1.2% Lupin   1.1% Neurocrine Biosciences   1.0% Ipca Laboratories   0.9% Bavarian Nordic   0.8% Infinity Pharmaceuticals   0.7% Radius Health (1) )   0.6% Tesaro   0.5% Ariad Pharmaceuticals   0.4% Idenix Pharmaceuticals   0.3% Probiodrug (1))   0.3% Achillion Pharmaceuticals   0.2% Strides Arcolab   0.1% Cubist Pharmaceuticals Contingent Value Rights- ex Trius   0.0% Cubist Pharmaceuticals Contingent Value Rights- ex Optimer   <0.1% Radius Health Warrants   0.0% Total securities   CHF 2 167.2 mn Other assets   CHF 43.7 mn Other payables   CHF (92.0) mn Total shareholder's equity   CHF 2 118.9 mn Treasury shares (in % of company) (2)   3.9% 1) Unlisted company 2) Correspond to the total of all own shares held including the second trading line Media Release_23.01.2014 (PDF): http://hugin.info/130285/R/1756424/593162.pdf This announcement is distributed by GlobeNewswire on behalf of GlobeNewswire clients. The owner of this announcement warrants that: (i) the releases contained herein are protected by copyright and other applicable laws; and (ii) they are solely responsible for the content, accuracy and originality of the information contained therein. Source: BB BIOTECH AG via GlobeNewswire [HUG#1756424]