Biotech Growth blames large caps for 2017/18 under-performance
OrbiMed-managed Biotech Growth Trust (BIOG) blamed an overweight position in large cap stocks for under-performance against the benchmark Nasdaq Biotechnology index (NBI) in the six months to March 2018 and financial year as a whole, having recorded a 6.7% fall in NAV against a 2.2% fall for the NBI in its 2017/18 financial year . Biotech Growth’s share price fell by 6.1% in the period, while the discount to NAV closed slightly to 6.1%.
2018 was the second time in the past six years in which Biotech Growth showed with a negative NAV return (the other was 2016, with a decline of 24.8%), but the gains in 2013-2015 and 2017 ranged between 27-67%. The average NAV growth for the trust over the past six financial years has been 24%, just ahead of that of the NBI at 23%.
Biotech growth said there main positive contributors in the latest financial year were Vertex Pharmaceuticals, Juno (which was acquired by Celgene) and BeiGene, and the main negative performance came from Celgene, Incyte and Regeneron.
Biotech Growth reported its top 10 holdings, as of end March with its April facthsheet. The trust reports a more comprehensive portfolio at the year end and the holdings ranked from 11-30 are shown in the table below (expressed as % of NAV).
| Amicus Therapeutics | 3.2 |
| Aerie | 3.0 |
| Bluebird Bio | 2.9 |
| Clovis Oncology | 2.3 |
| Insmed | 2.0 |
| ACADIA Pharma | 2.0 |
| Jazz Pharma | 2.0 |
| BioMarin | 1.9 |
| Sarepta | 1.8 |
| Shire | 1.7 |
| Deciphera | 1.6 |
| Array Biopharma | 1.5 |
| DBV Technologies | 1.5 |
| Alkermes | 1.4 |
| GW Pharma | 1.3 |
| Athenex | 1.2 |
| Global Blood Therapeutics | 1.1 |
| Neurocrine Biosciences | 1.0 |
| Heron Therapeutics | 1.0 |
| BeiGene | 0.9 |