HBM HEALTHCARE INVESTMENTS AG Quarterly Report 2021
December
At a Glance
Profile and Portfolio
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HBM Healthcare Investments invests in the human medicine, biotechnology, medical techno logy and diagnostics sectors and related areas. The company holds and actively manages an international portfolio of prom
Currency allocation of assets 1)
Emphasis on US dollar investments.
Other currencies (CAD, DKK, GBP, HKD, SEK)
5%
Euro (EUR) 9%
Renminbi (CNY) 27%
US dollar (USD) 2) 54%
Indian rupee (INR)
4%
Swiss franc (CHF) 2)
1%
Ltd / Quarterly Report December 2021
ising companies.
Many of these companies have their lead products already available on the market or at an advanced stage of development. The portfolio companies are closely tracked and actively guided on their strategic directions. This is what makes HBM Healthcare Investments an interesting alternative to investing in big pharma and biotech companies. HBM Health care Investments has an international shareholder base and is listed on SIX Swiss Exchange (ticker: HBMN).
Allocation of assets 1)
Mainly invested in private companies or in companies originating from the private companies' portfolio.
Cash and cash equivalents | Funds |
9% | 8% |
Private | Other assets |
companies | |
23% | 1% |
Public | |
companies | |
59% |
Development phase of portfolio companies 3)
Mainly invested in revenue generating companies or in companies with products at an advanced stage of development.
Phase III | Profitable |
6% | |
43% | |
Phase II | |
13% | |
Phase I | |
4% | |
Preclinical | Products on |
the market | |
6% | 28% |
HBM Healthcare Investments
Investments by continents 3)
International portfolio.
Western Europe | |
14% | |
North | Asia |
and South | |
44% | |
America | |
42% |
Therapeutic area of the lead product of portfolio companies 3)
Broadly diversified areas of activity.
Infectious diseases | |
2% | Synthetic biology |
Medical technology/ | 30% |
diagnostics | |
3% | |
Orphan | Others |
diseases | |
18% | |
3% | |
Immunology / | Oncology |
inflammation | 17% |
5% | Central |
Digital health | nervous system |
16% | |
6% | |
- Total consolidated assets as at 31.12.2021: CHF 2 590 million.
- Net of foreign currency hedge (USD/CHF): about USD 47 percent and CHF 8 percent respectively.
- Total investments as at 31.12.2021: CHF 2 334 million.
At a Glance
Key Figures and Performance
Key Figures | 31.12.2021 | |
Net assets | CHF million | 2 339.5 |
Investments in private companies and funds | 810.5 | |
Investments in public companies | 1 523.5 | |
Cash and cash equivalents | ||
(net of liability from market hedging) | 226.0 | |
Net result for the period | CHF million | 275.0 |
Basic earnings per share | CHF | 39.52 |
Net asset value (NAV) per share | CHF | 336.27 |
Share price | CHF | 339.00 |
Premium (+) / discount (-) | % | + 0.8 |
Distribution per share | CHF | |
Distribution yield | % | |
Shares issued | Registered shares (m) | 7.0 |
Shares outstanding | Registered shares (m) | 7.0 |
Performance (including distributions) | 2021/2022 | |
(9 months) | ||
Net asset value (NAV) | % | 12.8 |
Registered share HBMN | % | 5.7 |
31.3.2021 | 31.3.2020 | 31.3.2019 | 31.3.2018 |
2 151.5 | 1 448.8 | 1 318.3 | 1 157.9 |
662.8 | 706.4 | 542.1 | 413.9 |
1 404.2 | 629.9 | 688.2 | 750.0 |
327.0 | 224.2 | 176.2 | 72.4 |
756.3 | 182.7 | 209.1 | 115.9 |
108.71 | 26.26 | 30.05 | 16.55 |
309.25 | 208.25 | 189.48 | 166.43 |
332.50 | 190.00 | 168.80 | 144.00 |
+ 7.5 | - 8.8 | - 10.9 | - 13.5 |
12.50 | 7.70 | 7.50 | 7.00 |
3.8 | 4.1 | 4.4 | 4.9 |
7.0 | 7.0 | 7.0 | 7.0 |
7.0 | 7.0 | 7.0 | 7.0 |
2020/2021 | 2019/2020 | 2018/2019 | 2017/2018 |
52.2 | 13.9 | 18.1 | 11.1 |
79.1 | 17.0 | 22.1 | 34.5 |
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HBM Healthcare Investments Ltd / Quarterly Report December 2021
Indexed performance since launch in CHF (12.7.2001 = 100), dividends reinvested
560
500 | HBM Healthcare Investments Share |
440
380
320 | HBM Healthcare Investments NAV |
260
200 NASDAQ Biotechnology Index
140 | MSCI World Health Care Index |
80
20
01.01.2012 31.12.2012 31.12.2013 | 31.12.2014 | 31.12.2015 | 31.12.2016 | 31.12.2017 | 31.12.2018 | 31.12.2019 | 31.12.2020 | 31.12.2021 |
Management Report
1 April to 31 December 2021
HBM Healthcare Investments generated a net profit of CHF 4 million in the reporting quarter ended 31 December 2021. For the first nine months of the 2021/2022 financial year, the net profit amounts to CHF 275 million. Although the biotech stock market in general declined, several portfolio companies announced operational successes, which resulted in higher valuations. With cash and cash equivalents of CHF 226 million, HBM Healthcare is well positioned for a market downturn and may benefit from buying opportunities at low valuations. Eight new investments in private companies complement the portfolio.
Dear Shareholders
HBM Healthcare Investments closed the third quarter of the 2021/2022 financial year with a small net profit of CHF 4 million amid a bearish market environment, at least in the biotech sector. The net asset value per share (NAV) increased by 0.2 percent during the same period, while the share price declined by 0.3 percent.
This results in a profit of CHF 275 million for the first nine months of the financial year and an in crease in the NAV of 12.8 percent.
Operational success as a basis for high valuations
The two private companies Swixx BioPharma and ConnectRN concluded financing rounds with new investors. Against the backdrop of the companies' very successful operational development, these led to an increase in the valuation of the two investments totalling CHF 72 million.
Swixx BioPharma announced the signing of an agreement for the exclusive distribution of Sanofi's prescription drugs in Eastern Europe. The company expects this to double its 2022 sales to over EUR 600 million and plans to expand its team to around 900 employees.
ConnectRN, the digital placement platform for nursing staff in the United States, increased its 2021 revenue organically by more than 240 percent and expects further growth in the current year.
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HBM Healthcare Investments Ltd / Quarterly Report December 2021
Management Report
1 April to 31 December 2021
Furthermore, BioShin, a Chinese subsidiary of listed Biohaven Pharmaceuticals, will be fully acquired by Biohaven as part of Biohaven's announced strategic partnership with Pfizer. Upon completion
of the transaction, HBM Healthcare Investments will receive Biohaven shares equivalent to approxi mately USD 23 million in exchange for its USD 8 million investment in BioShin.
Valo Health announced that the merger agreement signed in June with Khosla Ventures Acquisition Co. has been terminated by mutual consent. Accordingly, the value of the investment was reduced back to the original cost value.
Cathay Biotech defies declining stock market
Among the public companies originating from the private companies' portfolio, the pleasing share price performance of the Chinese company Cathay Biotech stood out in particular. The market capitalisation of this leader in synthetic biology rose by almost a fifth to over CHF 11 billion in the quarter under review, thereby compensating for the considerable market-related decline in the share prices of the other public holdings originating from the portfolio of private companies.
A detailed analyst report highlighted the potential of Cathay Biotech's technology to use straw instead of corn starch as the renewable resource to manufacture its products in the future. Thereby, Cathay wants to avoid bottlenecks in the procurement of raw materials which are expected for the growing biomass industry. According to OECD estimates, at least 20 percent of the world's chemical products will be replaced by biomass products by 2030. This corresponds to a market volume of USD 800 billion, and synthetic biology is said to play a central role in this replacement process.
With a share of 27 percent, Cathay Biotech is by far the largest holding in HBM Healthcare's portfolio. As Cathay's shares will remain subject to a lock-up period for the next 20 months, they are valued at a discount of 9.75 percent to the current market price, in the amount of CHF 76 million. The percent age of the lock-up discount will be reduced on a straight-line basis over the remaining term of the lock-up period.
Among the other public companies, Argenx and ChemoCentryx each benefitted from an FDA mar ket approval. Argenx was granted approval for VYVGARTTM for the treatment of the chronic neuro muscular autoimmune disease myasthenia gravis, characterised by weakness and rapid fatigability of the skeletal muscles, and ChemoCentryx for TAVNEOSTM for the treatment of ANCA-associated vasculitis, an inflammatory disease of the blood vessels. Furthermore, additional value was added by the acquisition of Dicerna by Novo Nordisk.
Eight new investments in private companies
During the quarter under review, new investments totalling CHF 52 million were made in eight private companies. A further CHF 18 million was invested in current portfolio companies. Among the new investments, the US company Upstream Bio received an investment commitment of USD 20 million, of which a first tranche of USD 11 million was paid in. Upstream Bio is developing an antibody therapy for the treatment of severe asthma.
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HBM Healthcare Investments Ltd / Quarterly Report December 2021
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HBM Healthcare Investments AG published this content on 21 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 January 2022 05:21:06 UTC.
