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Star BB Biotech manager steps back from Healthcare trust

Star BB Biotech manager steps back from Healthcare trust

Dr Daniel Koller, the star biotech fund manager at Bellevue who helped launch BB Healthcare (BBH) over two years ago, is stepping back from the investment trust to focus on the firm’s flagship fund.

Koller (pictured), head of investments at Bellevue, a healthcare specialist in Switzerland, will concentrate on BB Biotech (BION), the CHF3.9 billion (£3 billion) Zurich-listed investment company he has run since 2010.

Paul Major (pictured below), who has run BB Healthcare since its £150 million flotation in December 2016, will continue to run the listed fund with co-manager Brett Darke.

The company said it had always been Koller’s intention to step back as BBH evolved. Last year saw its net asset value (NAV) fall 15% in dollar terms after a 5% dividend paid from capital, underperforming the Nasdaq Biotech index which declined 8.9%.

The shares – which are listed in Switzerland, Germany and Italy, but not in London – have bounced back 16% this year and maintain their impressive long-term record of 939% total return in Swiss francs over 10 years.

BBH had a better 2018. Annual results last month reported a 24% total return on net assets in the 12 months to the end of November, beating its benchmark, the MSCI World Healthcare index, which returned 18%. Shareholders received a 21.6% total return, including a 3.5% dividend mostly paid from capital.

However, the markets crash in December wiped severely dented the concentrated portfolio of 28 healthcare stocks, reducing NAV growth for 2018 to 8.6% and shareholder returns for the year to 4.9%, according to Morningstar.

The Federal Reserve’s decision to pause US interest rate rises, which bolstered overall market sentiment, and the revival of healthcare merger and acquisitions with Bristol-Myers Squibb’s $74 billion bid for Celgene in January (both of which BBH held) have reversed that fall this year with the shares matching BB Biotech’s recovery with a 19.6% leap.

Over 12 months BBH currently sports a 30.2% shareholder return, the best in its sector and more than the 24.7% from Syncona (SYNC), which until recently was the group leader.

Investment returns, two fund raisings since flotation and steady share issuance have lifted BB Healthcare’s market value to £520 million.

Its chairman Justin Stebbing thanked Koller for his support for the two managers. ‘BB Healthcare’s investment team has delivered strong results for investors in these early years and the board has every confidence that they will continue to deliver moving forward,’ he said.

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