• Quarterly profit of CHF 26 million
• NAV increases by 1.6 percent and share price rises by 5.9 percent
• Private portfolio companies as value drivers

Positive start to the new financial year

HBM Healthcare Investments started the new 2024/2025 financial year with a quarterly profit of CHF 26 million. The net asset value per share (NAV) rose by 1.6 percent in the first three months to 30 June 2024, while the share price increased by 5.9 percent.

The focus was on positive developments in the portfolio of private companies, which contributed a total of CHF 53 million to the result, while public companies and funds had a negative impact on the result of CHF –14 million and CHF –4 million respectively.

Developments in the portfolio of public companies

The public companies weighed on the 3-month result by a total of CHF –14 million.

• Insmed and Merus both published convincing trial data and thus contributed CHF 10 million each to the result. Insmed published successful phase III data for brensocatib for the treatment of patients with bronchiectasis, while Merus presented positive interim data for petosemtamab in combination with pembrolizumab (Keytruda®) as first-line therapy for head and neck tumours.
• Further positive contributions came from Bioinvent (CHF 9 million) and Vicore Pharma (CHF 6 million).
• Y-mAbs Therapeutics (CHF –13 million), Biohaven (CHF –12 million), ALX Oncology (CHF –7 million) and Harmony Biosciences (CHF –6 million) made negative contributions to the result.
   

Developments in the portfolio of private companies

The private companies contributed CHF 53 million to the quarterly result or 3.1 percent to the increase in NAV.

• The acquisition of Yellow Jersey Therapeutics by Johnson & Johnson for USD 1.25 billion in cash resulted in a gain of CHF 59 million. The spin-off of the Swiss company Numab Therapeutics is testing a bispecific antibody for the treatment of atopic dermatitis in a phase I clinical trial. HBM Healthcare will retain an 8 percent stake in Numab Therapeutics.
• Swixx BioPharma, which generates sales of more than EUR 1 billion in Eastern Europe and Central Asia, has further expanded its market position as a service provider for international pharmaceutical companies with the acquisition of Laboratorios Biopas. With Biopas, Swixx BioPharma gains access to the largest markets in Central and South America and secures 300 employees in a total of 20 countries and sales of USD 220 million.
• Alumis Therapeutics raised USD 250 million in new capital through an IPO on the Nasdaq stock exchange. HBM Healthcare Investments invested USD 5 million in Alumis at the beginning of the year and increased its stake by a further USD 15 million in the IPO. Alumis develops oral therapies for the treatment of immunodeficiencies.
• Bluejay Therapeutics joins HBM Healthcare's private portfolio following an investment of USD 7 million. The US company develops therapies for viral and liver diseases.

After the balance sheet date at the beginning of July, Fangzhou Jianke, the leading online platform for the management of chronic diseases in China, became the latest private company to go public, this time at the Hong Kong stock exchange. The issue price of the new shares was higher than the book value of our investment at the end of the quarter. However, trading in the shares got off to an unfriendly start in the first few days up to mid-July, reducing the last published NAV as at 15 July by just under 0.9 percent.

Asset allocation

There has been little change in the asset allocation compared to the beginning of the financial year: 43 percent of assets are attributable to public companies (nearly half of which were previously private companies), 38 percent to private companies, 10 percent to funds, 7 percent to cash and cash equivalents and 2 percent to other assets.

In order to reduce exposure to currency fluctuations, one third of the US dollar currency risk was hedged against the Swiss franc in the quarter under review.

Outlook

The macroeconomic market environment remains challenging. The measures taken by central banks to combat inflation in the US and Europe are having an effect, and the interest rate cuts expected in the second half of the year should further improve market sentiment for growth companies. However, the rapidly rising national debt, the upcoming elections and political polarisation in the US and various European countries, as well as the ongoing trade conflicts and geopolitical confrontations, are a cause for concern. Against this backdrop, HBM Healthcare Investments will continue to act with the necessary caution.

From a fundamental perspective, the portfolio remains well positioned and broadly diversified. The majority of the private portfolio companies are making swift progress in their development, which should soon enable some of them to take the next step in the form of an IPO or a strategic transaction.

In the portfolio of public companies, several companies are positioned for further value growth based on expected study data: ALX Oncology, ArriVent, Biohaven, BioInvent, IO Biotech, Mineralys Therapeutics and Natera have exciting publications in various therapeutic indications coming up in the second half of the year, which should have an overall positive impact on the value of the portfolio.

The Quarterly Report June 2024 is available on the Company’s website at www.hbmhealthcare.com/en/investors/financial-reports.