BB BIOTECH: Positive development thanks to Genentech and Vertex participations

Thursday, 30. July 2009 07:30
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Interim Report as at June 30, 2009

During 1H 2009, BB BIOTECH's share price appreciated by 4.2% (in CHF,
including dividend), while BB BIOTECH's Net Asset Value (NAV) is flat
since the beginning of the year. BB BIOTECH's performance during 1H
2009 was in line with the performance of the financial markets during
this time period. Although it was not possible in the first six
months of 2009 to achieve additional gains for our shareholders, BB
BIOTECH's superior performance since its foundation has been

During 1H 2009, significant acquisitions of biotech companies by
pharma took place, reducing the total market capitalization of the
Biotech industry to approximately USD 300 bn. With biotech holdings
worth CHF 1.448 bn, BB BIOTECH remains one of the leading investors
in the industry. On the negative side, BB BIOTECH's share price
continued to trade below the Net Asset Value of the company. We
continue to use various measures of keeping the share price of BB
BIOTECH close to its Net Asset Value. At BB BIOTECH's extraordinary
general meeting on July 6, 2009, it was decided to initiate another
share buyback program of up to 1.8225 mn shares, for the benefit of
our shareholders and to close the discount of BB BIOTECH's share
price to its Net Asset Value. We expect the share buyback program to
commence at the end of 3Q 2009.

In March 2009, the acquisition of the minority stake of Genentech by
Roche was completed. The transaction was historical in many ways and
marked the end of BB BIOTECH's successful investment in Genentech.
Within our core holdings, Vertex appreciated by 18%, driven by an
increasing amount of clinical data for its lead product Telaprevir
for treatment of Hepatitis C. We expect Telaprevir to become one of
the outstanding successes of biotech in the coming years. Another
core holding, Celgene, experienced a 14% decline in its share price.
The decline was due to a lower than expected growth rate during the
first quarter of 2009. For the balance of the year, we expect
additional data from Celgene's core product Revlimid for use as a
front-line agent for treatment of Multiple Myeloma to boost Revlimid
sales significantly.

Our other core holdings Actelion and Gilead continued to deliver
strong performance based on strong product sales. On the negative
side, one of our small positions, The Medicines Company, suffered a
significant setback when an important pipeline project failed to show
efficacy in phase III trials. As we had reduced the position
substantially ahead of that event, our very significant profit on our
long-term investment in The Medicines Company was only slightly

During the first half of 2009, BB BIOTECH invested in Novo Nordisk,
the world market leader in the area of diabetes. Novo Nordisk is
currently launching Victoza in Europe (Liraglutide), which we value
as being the best drug in an emerging class of drugs called GLP-1
analogues. We expect Victoza to become a leading drug for treatment
of diabetes. Regarding the most recent safety issues concerning
insulin-related drugs from one of Novo Nordisk's competitors, we
don't expect Novo Nordisk to face the same issues with its products
and we expect Novo Nordisk to be able to continue its long-term
growth. In addition, we started an investment in Clinuvel, an
Australian based company which is developing a drug for the therapy
of rare diseases of patients who cannot tolerate sunlight.

We added to our positions in Zymogenetics and Arena because a decline
of the share prices of these companies offered compelling
opportunities. We opportunistically reduced some of our core holdings
for portfolio reasons, in order to raise cash.

The ongoing economic crisis will trigger some changes in the
healthcare systems of developed countries. We are monitoring these
developments closely and include the most likely scenarios in our
investment strategy. We are very confident that the value of
innovative and powerful new drugs will not be minimized by upcoming
changes and we expect our portfolio companies to continue to be the
long-term winners.

For the balance of the year we expect significant positive news flow
from some of our core holdings, including Actelion, Celgene and
Vertex. Due to a very significant decline in the valuation of many
small cap and private biotech companies, we see unprecedented
opportunities to acquire significant stakes in promising companies at
very reasonable valuations. We are working diligently to exploit
these opportunities.

This is the composition of BB BIOTECH's Portfolio as at June 30, 2009
(in % of securities, rounded values):

Actelion 31.2%
Gilead 21.1%
Celgene 15.6%
Vertex Pharmaceuticals 12.8%

Novo Nordisk 4.1%
Biogen Idec 2.5%
Zymogenetics 2.1%
Arena Pharmaceuticals 1.8%
Roche Holding 1.8%
Basilea Pharmaceutica 1.1%
Optimer Pharmaceuticals 1.1%
NicOx 0.9%
Affymetrix 0.9%
Elan 0.7%
Epigenomics 0.3%
The Medicines Company 0.2%
Incyte 0.2%
BioXell 0.2%
Rigel Pharmaceuticals 0.2%
Keryx Biopharmaceuticals 0.1%
Clinuvel 0.1%
3% Convertible Bond Deutsche Bank (-18.05.2012)* 0.2%

Actelion put option (short) <(0.1%)
Biogen Idec call option (short) <(0.1%)
Basilea put option (short) <(0.1%)
Basilea call option (short) <(0.1%)
USD/CHF put option (long) 1.0%
USD/CHF call option (short) (0.1%)
SWAP agreement on treasury shares <0.1%

Total securities CHF 1 448.8 mn

Liquid funds (net) CHF 24.3 mn
Other assets CHF 28.6 mn
Other payables CHF (3.6) mn

Total shareholder's equity CHF 1 498.1 mn
Treasury shares (in % of company) 8.7%

* Convertible into registered shares BB BIOTECH AG
The Interim Report as at June 30, 2009 is available on

For further information please contact:
Bellevue Asset Management AG, Seestrasse 16, CH-8700 Kusnacht,
Nafida Bendali or Maria-Grazia Alderuccio, Tel. +41 44 267 67 00

Company profile:
BB BIOTECH acquires holdings in companies in the biotechnology growth
market and is currently one of the world's largest investors in the
sector. BB BIOTECH is listed in Switzerland, in Germany and in Italy.
The focus of the holdings is on quoted companies that are
concentrating on the development and marketing of innovative
medicines. For the selection of holdings, BB BIOTECH relies on
fundamental analysis by physicians and molecular biologists. The
Board of Directors has many years of industrial and scientific

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Vordergasse 3 Schaffhausen Switzerland

ISIN: CH0038389992; Index: SBIOM, IGSP, SLIFE;
Listed: Investment Companies in SIX Swiss Exchange;

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