Onwards and upwards for performance recovery
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Edison Investment Research Limited
London, UK, 20 March 2024
Edison issues update on The Biotech Growth Trust (BIOG): Onwards and upwards for performance recovery The Biotech Growth Trust’s (BIOG’s) two co-managers, Geoff Hsu and Josh Golomb, at global healthcare specialist OrbiMed, believe that now could be an opportune time to consider the biotech sector as it is recovering from the longest and largest absolute and relative drawdown since 2006. The sector was negatively affected by sharply rising interest rates rather than a deterioration in industry fundamentals; indeed, the managers continue to refer to a ‘golden era’ of innovation within the biotech sector. BIOG’s relative performance has been through a difficult period given its high weighting in emerging (smaller-cap) biotech stocks, which performed significantly worse than the shares of large-cap biotech businesses during the sector sell-off.
BIOG’s managers are very excited about the trust’s prospects and encouraged that investors are once again rewarding biotech companies that deliver positive outcomes. For example, Janux Therapeutics recently reported positive Phase I data for its product for the treatment of prostate cancer and its shares appreciated by more than 200%. This move has catapulted the company into BIOG’s list of 10 largest holdings. In keeping with many other investment companies, the trust’s discount is wider than its historical averages. This offers scope for BIOG to be afforded a higher valuation now that its performance is back on track, and there is potential for an improvement in investor sentiment in a less uncertain economic environment.
All reports published by Edison are available to download free of charge from its website About Edison: Edison is a leading research and investor relations consultancy, connecting listed companies to the widest pool of global investors. By focusing on the volume and quality of investors reached – across institutions, family offices, wealth managers and retail investors – Edison can create and gauge intent to purchase, even in the darkest pools of capital, and then make introductions via non-deal roadshows, events or virtual meetings. Having been the first company in-market 17 years ago, Edison has more than 100 employees and covers every economic sector. Headquartered in London, Edison also has offices in New York, Sydney and Wellington. Edison is authorised and regulated by the Financial Conduct Authority. Edison is not an adviser or broker-dealer and does not provide investment advice. Edison’s reports are not solicitations to buy or sell any securities. For more information, please contact Edison: Mel Jenner +44 (0)20 3077 5700 investmenttrusts@edisongroup.com Learn more at www.edisongroup.com and connect with Edison on: LinkedIn www.linkedin.com/company/edison-group-/ Twitter www.twitter.com/Edison_Inv_Res YouTube www.youtube.com/edisonitv
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1863155 20-March-2024
