ShareSoc Company Seminar - April 2018

Monday, Apr 23 2018 by

Sadly I was unable to attend last month's seminar so I was especially keen to make this April meeting and the chance to learn about four unfamiliar companies. Actually that's not quite true as I had heard of Beeks Financial Cloud on the grapevine but that's about it. All new names here then.

International Biotechnology Trust (IBT)

Kicking off the evening Carl Harald Janson, from International Biotechnology Trust, explained how the trust has been successfully investing in the biotech space since 1994. The reason for focusing on this sector is it's a high growth area (12.9% p.a. over last 20 years) with several growth drivers for the future. In a virtuous circle the worldwide population is becoming increasingly elderly, which means more disease, and a rising number of new drugs are in development to treat these diseases. At the same time the regulatory environment is favourable to commercialising new drugs with various schemes (orphan, breakthrough, first in class) set up to expedite the approval process of exceptional drugs. This all leads to growth in global pharma sales and a market conducive to M&A activity as larger companies gobble up small ones for their intellectual property.

Now International Biotechnology Trust aren't in the business of selecting companies just because they might be taken over but in the past eighteen months 9 of their holdings did just that. What they actually have is a portfolio made up, more or less equally, of large, medium and small companies (where small is <$1bn) with these firms again split between those that are profitable, in drug development or only producing revenue. This diversification is all about reducing the risk of capital loss and the team don't stop there. They also heavily reduce positions before a binary event (such as a drug trial result) on the basis that they'd rather pay a higher price later on (when the result is known) than expose themselves to risk. This approach does lead to a very high turnover (150-200%) but Carl believes that overall the tactic improves returns.

Curiously the trust used to trade at a significant discount to net assets, of around 15%, despite good performance. As a result the board decided to implement a dividend of 4% of NAV back in 2016 and now the discount has entirely closed. Given that this dividend is paid from capital reserves Carl spent some…

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International Biotechnology Trust plc is an investment trust company. The Company's investment objective is to achieve long-term capital growth by investing in biotechnology and other life sciences companies. The Company will seek to achieve its objective by investing in a diversified portfolio of companies, which may be quoted or unquoted and whose shares are considered to have growth prospects, with experienced management and strong potential upside through the development and/or commercialization of a product, device or enabling technology. It may invest through equities, index-linked securities and debt securities, cash deposits, money market instruments and foreign currency exchange transactions. Investments may also be made in related sectors, such as medical devices and healthcare services. Its portfolio is split between large, mid and small-capitalization companies, primarily quoted on stock exchanges in North America. Its investment manager is SV Life Sciences Managers LLP. more »

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Impax Asset Management Group plc is an investment company offering listed and private equity strategies primarily to institutional clients. The Company has six listed equity strategies: Specialists, Leaders, Water, Asia-Pacific, Global Opportunities, and Food and Agriculture. Its real assets business comprises renewable power generation and sustainable property private equity funds. The Company has investments sectors, such as energy efficiency, which includes power network and buildings; alternative energy, which include solar, wind and biofuels; water infrastructure/technologies, which include treatment and utilities; pollution control, which include pollution control solutions, and testing and gas sensing; food, agriculture and forestry, which include logistics and sustainable forestry; waste management and technologies, which include tech equipment and hazardous, and environmental support services, which include consultancies and diversified environmental. more »

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Amryt Pharma plc is a commercial-stage specialty pharmaceutical company focused on developing and delivering treatments for patients with rare and orphan diseases. The Company is building a diversified portfolio of proprietary drugs to help address some of rare and debilitating illnesses. The Company’s lead products include AP 101 and AP102. AP101 (Episalvan) is a potential treatment for Epidermolysis Bullosa (EB), and it is in Phase III clinical trials. AP102 is focused on developing novel, next generation somatostatin analogue (SSA) peptide medicines for patients with rare neuroendocrine diseases. The Company holds an exclusive license to sell Lojuxta (lomitapide) for adults, across the European Union (EU) and other territories, including the Middle East, North Africa, Turkey and Israel. Lojuxta is used to treat a rare life-threatening disease called Homozygous Familial Hypercholesterolemia, which impairs the body’s ability to remove LDL cholesterol (bad cholesterol) from the blood. more »

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  Is LON:IBT fundamentally strong or weak? Find out More »

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jonthetourist 23rd Apr '18 1 of 1

Thanks for this report, Damian

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