Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Please change me...

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in Danaher and Quest and we exited Beigene.

Performance review: The largest attributors vs. the index were Bristol-Myers Squibb (+25 bps / Not invested), Johnson & Johnson (+21 bps / Not invested) and Abbvie (+20 bps / Not invested).

The largest detractors vs the index were Eli Lilly (-32 bps / The stock returned 8.8% in April and we are underweight versus the reference index), Thermo Fisher (-14 bps / Overall weakness of Life Sciences Tools & Services stocks after tariff announcements. Later, the company reported solid Q1 results, but reduced the 2025 outlook due to tariffs and US policy changes) and Biomarin (-11 bps / No specific news. Overall weakness after tariff announcements).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Overall, we are encouraged by the continued outperformance of the healthcare sector, which we believe is justified given the strong earnings rebound expected this year and the depressed valuations.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest attributors vs. the index were Eli Lilly (+24 bps / The stock lost 10.3% and we are underweight versus the benchmark), HCA (+21 bps / No company specific news. The stock returned 13% in March, but experienced large intra-month volatility driven by various policy-news (changes in Medicaid funding), a positive broker on hospitals, and negative press on the space (Economist)) and Novartis (+17 bps / Positive competitor data readout. Company outperformed European peers over the month).

The largest detractors vs the index were Dexcom (-41 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears), Novo Nordisk (-15 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025) and Elevance (-14 bps / Not invested).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in GSK and Zai Lab and no position was exited.

Performance review: The largest contributors were Hypera (+89 bps / Q1 results were broadly in line with expectations, although the P&L was significantly impacted by the concentrated execution of the company’s working capital (WC) adjustment plan. This weighed heavily on topline performance and profitability), BioNTech (+45 bps / The Akeso/Summit trial results in China provided a positive read-across to BioNTech, fueling bullish sentiment around PD-1/VEGF bispecifics as a potential new standard-of-care backbone in lung cancer) and Penumbra (+35 bps / Reported better than expected Q1 results).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Performance review: The largest contributors were Agilon (+49 bps / Normalization of performance after a very weak 2024. Upbeat presentation at the Cowen Healthcare Conference in March), Hypera (+17 bps / Q4 top-line results were in-line with estimates, while EPS was better than expected. Importantly, channel inventory adjustment is happening faster than anticipated) and Centene (+14 bps / The company confirmed its 2025 guidance. Otherwise, the stock was hit by various policy-news (House GOP eying reduction to Medicaid targeted at the "expansion population" of the program / CMS rule focused on program integrity on the healthcare exchanges))

The largest detractors were Novo Nordisk (-80 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025), Dexcom (-73 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears) and Amplifon (-69 bps / Q4 results came in below expectations (primarily due to continued softness in Europe) and 2025 guidance (back-end loaded and wider than usual) was also lower than estimated).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The healthcare sector widened its year-to-date outperforming through a strong reporting season, with 4.8% lead vs the market as of 28th Feb. Both sales and earnings growth outpaced the market year-on-year, indicating both strong underlying factors as well as margin expansion.

However, the Trump administration has been the source of much headline volatility over the past few weeks. This has affected specific areas ranging from federal grant funding to Medicaid funding and vaccines. 

Overall, these announcements have added an uncertainty premium to select names and sector areas. However, we view fundamentals as broadly unaffected.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest contributors were Axsome (+63 bps / The firm has entered into a settlement agreement with Teva resolving all patent litigation related to Axsome's AUVELITY product. Later, the stock was initiated with a buy rating by a major broker. After lower-than-expected Q4 results, Axsome gave up some performance, only to start performing again later in the month after announcing that the EMERGE Phase 3 trial of SYMBRAVO reached its primary endpoint. Overall, the stock gained 20% in February), Gilead (+59 bps / Q4 results were better than expected and outlook on EPS-level was higher than estimated. Gilead showed good performance across HIV, Trodelvy and liver disease portfolios) and Abbott (+28 bps / No specific news. Positive momentum from January continued in February).

The largest detractors were Tandem (-141 bps / Q4 sales were higher, and EBITDA was lower than consensus. The 2025 outlook was lighter than estimated and includes an EU commercial transition to direct distribution and an US commercial organization expansion that could cause disruption), Exact Sciences (-53 bps / Q4 revenues were in-line with the pre-announcement, while EBITDA was higher than consensus. 2025 guidance for revenues was in-line (with Cologuard to grow 13% vs earlier expectations of 15%), while margins fell short) and RadNet (-46 bps / Q4 results were better than expected and 2025 EBITDA-outlook was lower than consensus. However, fundamentals remain intact and guidance was impacted by two one-offs (winter storms and California fires) with volumes back to normal now).

ESG: Firms in the portfolio did not report any material ESG issues in February.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in GSK and Zai Lab and no position was exited.

Performance review: The largest contributors were Hypera (+89 bps / Q1 results were broadly in line with expectations, although the P&L was significantly impacted by the concentrated execution of the company’s working capital (WC) adjustment plan. This weighed heavily on topline performance and profitability), BioNTech (+45 bps / The Akeso/Summit trial results in China provided a positive read-across to BioNTech, fueling bullish sentiment around PD-1/VEGF bispecifics as a potential new standard-of-care backbone in lung cancer) and Penumbra (+35 bps / Reported better than expected Q1 results).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Performance review: The largest contributors were Agilon (+49 bps / Normalization of performance after a very weak 2024. Upbeat presentation at the Cowen Healthcare Conference in March), Hypera (+17 bps / Q4 top-line results were in-line with estimates, while EPS was better than expected. Importantly, channel inventory adjustment is happening faster than anticipated) and Centene (+14 bps / The company confirmed its 2025 guidance. Otherwise, the stock was hit by various policy-news (House GOP eying reduction to Medicaid targeted at the "expansion population" of the program / CMS rule focused on program integrity on the healthcare exchanges))

The largest detractors were Novo Nordisk (-80 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025), Dexcom (-73 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears) and Amplifon (-69 bps / Q4 results came in below expectations (primarily due to continued softness in Europe) and 2025 guidance (back-end loaded and wider than usual) was also lower than estimated).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The healthcare sector widened its year-to-date outperforming through a strong reporting season, with 4.8% lead vs the market as of 28th Feb. Both sales and earnings growth outpaced the market year-on-year, indicating both strong underlying factors as well as margin expansion.

However, the Trump administration has been the source of much headline volatility over the past few weeks. This has affected specific areas ranging from federal grant funding to Medicaid funding and vaccines. 

Overall, these announcements have added an uncertainty premium to select names and sector areas. However, we view fundamentals as broadly unaffected.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest contributors were Axsome (+63 bps / The firm has entered into a settlement agreement with Teva resolving all patent litigation related to Axsome's AUVELITY product. Later, the stock was initiated with a buy rating by a major broker. After lower-than-expected Q4 results, Axsome gave up some performance, only to start performing again later in the month after announcing that the EMERGE Phase 3 trial of SYMBRAVO reached its primary endpoint. Overall, the stock gained 20% in February), Gilead (+59 bps / Q4 results were better than expected and outlook on EPS-level was higher than estimated. Gilead showed good performance across HIV, Trodelvy and liver disease portfolios) and Abbott (+28 bps / No specific news. Positive momentum from January continued in February).

The largest detractors were Tandem (-141 bps / Q4 sales were higher, and EBITDA was lower than consensus. The 2025 outlook was lighter than estimated and includes an EU commercial transition to direct distribution and an US commercial organization expansion that could cause disruption), Exact Sciences (-53 bps / Q4 revenues were in-line with the pre-announcement, while EBITDA was higher than consensus. 2025 guidance for revenues was in-line (with Cologuard to grow 13% vs earlier expectations of 15%), while margins fell short) and RadNet (-46 bps / Q4 results were better than expected and 2025 EBITDA-outlook was lower than consensus. However, fundamentals remain intact and guidance was impacted by two one-offs (winter storms and California fires) with volumes back to normal now).

ESG: Firms in the portfolio did not report any material ESG issues in February.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in GSK and Zai Lab and no position was exited.

Performance review: The largest contributors were Hypera (+89 bps / Q1 results were broadly in line with expectations, although the P&L was significantly impacted by the concentrated execution of the company’s working capital (WC) adjustment plan. This weighed heavily on topline performance and profitability), BioNTech (+45 bps / The Akeso/Summit trial results in China provided a positive read-across to BioNTech, fueling bullish sentiment around PD-1/VEGF bispecifics as a potential new standard-of-care backbone in lung cancer) and Penumbra (+35 bps / Reported better than expected Q1 results).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Performance review: The largest contributors were Agilon (+49 bps / Normalization of performance after a very weak 2024. Upbeat presentation at the Cowen Healthcare Conference in March), Hypera (+17 bps / Q4 top-line results were in-line with estimates, while EPS was better than expected. Importantly, channel inventory adjustment is happening faster than anticipated) and Centene (+14 bps / The company confirmed its 2025 guidance. Otherwise, the stock was hit by various policy-news (House GOP eying reduction to Medicaid targeted at the "expansion population" of the program / CMS rule focused on program integrity on the healthcare exchanges))

The largest detractors were Novo Nordisk (-80 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025), Dexcom (-73 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears) and Amplifon (-69 bps / Q4 results came in below expectations (primarily due to continued softness in Europe) and 2025 guidance (back-end loaded and wider than usual) was also lower than estimated).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The healthcare sector widened its year-to-date outperforming through a strong reporting season, with 4.8% lead vs the market as of 28th Feb. Both sales and earnings growth outpaced the market year-on-year, indicating both strong underlying factors as well as margin expansion.

However, the Trump administration has been the source of much headline volatility over the past few weeks. This has affected specific areas ranging from federal grant funding to Medicaid funding and vaccines. 

Overall, these announcements have added an uncertainty premium to select names and sector areas. However, we view fundamentals as broadly unaffected.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest contributors were Axsome (+63 bps / The firm has entered into a settlement agreement with Teva resolving all patent litigation related to Axsome's AUVELITY product. Later, the stock was initiated with a buy rating by a major broker. After lower-than-expected Q4 results, Axsome gave up some performance, only to start performing again later in the month after announcing that the EMERGE Phase 3 trial of SYMBRAVO reached its primary endpoint. Overall, the stock gained 20% in February), Gilead (+59 bps / Q4 results were better than expected and outlook on EPS-level was higher than estimated. Gilead showed good performance across HIV, Trodelvy and liver disease portfolios) and Abbott (+28 bps / No specific news. Positive momentum from January continued in February).

The largest detractors were Tandem (-141 bps / Q4 sales were higher, and EBITDA was lower than consensus. The 2025 outlook was lighter than estimated and includes an EU commercial transition to direct distribution and an US commercial organization expansion that could cause disruption), Exact Sciences (-53 bps / Q4 revenues were in-line with the pre-announcement, while EBITDA was higher than consensus. 2025 guidance for revenues was in-line (with Cologuard to grow 13% vs earlier expectations of 15%), while margins fell short) and RadNet (-46 bps / Q4 results were better than expected and 2025 EBITDA-outlook was lower than consensus. However, fundamentals remain intact and guidance was impacted by two one-offs (winter storms and California fires) with volumes back to normal now).

ESG: Firms in the portfolio did not report any material ESG issues in February.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in GSK and Zai Lab and no position was exited.

Performance review: The largest contributors were Hypera (+89 bps / Q1 results were broadly in line with expectations, although the P&L was significantly impacted by the concentrated execution of the company’s working capital (WC) adjustment plan. This weighed heavily on topline performance and profitability), BioNTech (+45 bps / The Akeso/Summit trial results in China provided a positive read-across to BioNTech, fueling bullish sentiment around PD-1/VEGF bispecifics as a potential new standard-of-care backbone in lung cancer) and Penumbra (+35 bps / Reported better than expected Q1 results).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Performance review: The largest contributors were Agilon (+49 bps / Normalization of performance after a very weak 2024. Upbeat presentation at the Cowen Healthcare Conference in March), Hypera (+17 bps / Q4 top-line results were in-line with estimates, while EPS was better than expected. Importantly, channel inventory adjustment is happening faster than anticipated) and Centene (+14 bps / The company confirmed its 2025 guidance. Otherwise, the stock was hit by various policy-news (House GOP eying reduction to Medicaid targeted at the "expansion population" of the program / CMS rule focused on program integrity on the healthcare exchanges))

The largest detractors were Novo Nordisk (-80 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025), Dexcom (-73 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears) and Amplifon (-69 bps / Q4 results came in below expectations (primarily due to continued softness in Europe) and 2025 guidance (back-end loaded and wider than usual) was also lower than estimated).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The healthcare sector widened its year-to-date outperforming through a strong reporting season, with 4.8% lead vs the market as of 28th Feb. Both sales and earnings growth outpaced the market year-on-year, indicating both strong underlying factors as well as margin expansion.

However, the Trump administration has been the source of much headline volatility over the past few weeks. This has affected specific areas ranging from federal grant funding to Medicaid funding and vaccines. 

Overall, these announcements have added an uncertainty premium to select names and sector areas. However, we view fundamentals as broadly unaffected.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest contributors were Axsome (+63 bps / The firm has entered into a settlement agreement with Teva resolving all patent litigation related to Axsome's AUVELITY product. Later, the stock was initiated with a buy rating by a major broker. After lower-than-expected Q4 results, Axsome gave up some performance, only to start performing again later in the month after announcing that the EMERGE Phase 3 trial of SYMBRAVO reached its primary endpoint. Overall, the stock gained 20% in February), Gilead (+59 bps / Q4 results were better than expected and outlook on EPS-level was higher than estimated. Gilead showed good performance across HIV, Trodelvy and liver disease portfolios) and Abbott (+28 bps / No specific news. Positive momentum from January continued in February).

The largest detractors were Tandem (-141 bps / Q4 sales were higher, and EBITDA was lower than consensus. The 2025 outlook was lighter than estimated and includes an EU commercial transition to direct distribution and an US commercial organization expansion that could cause disruption), Exact Sciences (-53 bps / Q4 revenues were in-line with the pre-announcement, while EBITDA was higher than consensus. 2025 guidance for revenues was in-line (with Cologuard to grow 13% vs earlier expectations of 15%), while margins fell short) and RadNet (-46 bps / Q4 results were better than expected and 2025 EBITDA-outlook was lower than consensus. However, fundamentals remain intact and guidance was impacted by two one-offs (winter storms and California fires) with volumes back to normal now).

ESG: Firms in the portfolio did not report any material ESG issues in February.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in GSK and Zai Lab and no position was exited.

Performance review: The largest contributors were Hypera (+89 bps / Q1 results were broadly in line with expectations, although the P&L was significantly impacted by the concentrated execution of the company’s working capital (WC) adjustment plan. This weighed heavily on topline performance and profitability), BioNTech (+45 bps / The Akeso/Summit trial results in China provided a positive read-across to BioNTech, fueling bullish sentiment around PD-1/VEGF bispecifics as a potential new standard-of-care backbone in lung cancer) and Penumbra (+35 bps / Reported better than expected Q1 results).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Performance review: The largest contributors were Agilon (+49 bps / Normalization of performance after a very weak 2024. Upbeat presentation at the Cowen Healthcare Conference in March), Hypera (+17 bps / Q4 top-line results were in-line with estimates, while EPS was better than expected. Importantly, channel inventory adjustment is happening faster than anticipated) and Centene (+14 bps / The company confirmed its 2025 guidance. Otherwise, the stock was hit by various policy-news (House GOP eying reduction to Medicaid targeted at the "expansion population" of the program / CMS rule focused on program integrity on the healthcare exchanges))

The largest detractors were Novo Nordisk (-80 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025), Dexcom (-73 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears) and Amplifon (-69 bps / Q4 results came in below expectations (primarily due to continued softness in Europe) and 2025 guidance (back-end loaded and wider than usual) was also lower than estimated).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The healthcare sector widened its year-to-date outperforming through a strong reporting season, with 4.8% lead vs the market as of 28th Feb. Both sales and earnings growth outpaced the market year-on-year, indicating both strong underlying factors as well as margin expansion.

However, the Trump administration has been the source of much headline volatility over the past few weeks. This has affected specific areas ranging from federal grant funding to Medicaid funding and vaccines. 

Overall, these announcements have added an uncertainty premium to select names and sector areas. However, we view fundamentals as broadly unaffected.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest contributors were Axsome (+63 bps / The firm has entered into a settlement agreement with Teva resolving all patent litigation related to Axsome's AUVELITY product. Later, the stock was initiated with a buy rating by a major broker. After lower-than-expected Q4 results, Axsome gave up some performance, only to start performing again later in the month after announcing that the EMERGE Phase 3 trial of SYMBRAVO reached its primary endpoint. Overall, the stock gained 20% in February), Gilead (+59 bps / Q4 results were better than expected and outlook on EPS-level was higher than estimated. Gilead showed good performance across HIV, Trodelvy and liver disease portfolios) and Abbott (+28 bps / No specific news. Positive momentum from January continued in February).

The largest detractors were Tandem (-141 bps / Q4 sales were higher, and EBITDA was lower than consensus. The 2025 outlook was lighter than estimated and includes an EU commercial transition to direct distribution and an US commercial organization expansion that could cause disruption), Exact Sciences (-53 bps / Q4 revenues were in-line with the pre-announcement, while EBITDA was higher than consensus. 2025 guidance for revenues was in-line (with Cologuard to grow 13% vs earlier expectations of 15%), while margins fell short) and RadNet (-46 bps / Q4 results were better than expected and 2025 EBITDA-outlook was lower than consensus. However, fundamentals remain intact and guidance was impacted by two one-offs (winter storms and California fires) with volumes back to normal now).

ESG: Firms in the portfolio did not report any material ESG issues in February.

Market review: The key news items this month were the US tariffs. This led to a major sell-off which has mostly recovered since. The healthcare sector underperformed during the month, but this was not only due to tariffs: UnitedHealth, the second largest company in the index, cut guidance due to higher healthcare utilization. While negative for that company, we see it as confirmation of our core view of accelerating healthcare demand. During Q1 earnings, almost all commented on the tariff situation. In general, companies expect revenues to be affected by amounts ranging from 1.3% to less than a tenth of a percent of current-year sales. This is small enough that it can be absorbed by sales growth without impacting guidance. However, this impact only factors in the tariffs which were announced around mid-April, i.e. very high tariffs on Chinese imports as well as 10% tariffs globally until July 1st, with the original, high global tariffs afterwards. Many companies have started to move around inventory and to shift their supply chains to be able to withstand further shocks.

Rumors around plans for pharma-specific tariffs as well as the possibility of introducing MFN pricing remain the biggest overhang for the sector Company executives have been outspoken regarding the negative impact of such policies, which could lead to drastic access issues for patients in the US.

Overall, our confidence in the sector is unchanged, but this example reinforces our commitment to rigorous stock selection.

Portfolio changes: We initiated new positions in GSK and Zai Lab and no position was exited.

Performance review: The largest contributors were Hypera (+89 bps / Q1 results were broadly in line with expectations, although the P&L was significantly impacted by the concentrated execution of the company’s working capital (WC) adjustment plan. This weighed heavily on topline performance and profitability), BioNTech (+45 bps / The Akeso/Summit trial results in China provided a positive read-across to BioNTech, fueling bullish sentiment around PD-1/VEGF bispecifics as a potential new standard-of-care backbone in lung cancer) and Penumbra (+35 bps / Reported better than expected Q1 results).

ESG: Firms in the portfolio did not report any material ESG issues in April.

Market review: Despite a tough market environment of the month and the quarter, Healthcare has continued outperforming the market, led by Healthcare Services. The outsized moves seen on stock specific news items, even if well-expected show the pent-up nervousness from market participants (Dexcom, Alnylam, Genmab).

This month, Novartis and Merck each committed close to $2bn to license phase 2 assets from Chinese companies. These recent, high-profile deals for cardiovascular and metabolic assets are the latest in an accelerating series of deals by Western companies to acquire assets developed in China. These deals, often for early development candidates, highlight the breadth and depth of competence and innovation in the laboratories of Chinese companies.

Further, Dr. Peter Marks, head of the Center for Biologics Evaluation and Research (CBER) resigned on the 28th of March. CBER regulates vaccines in the US. In his resignation letter, Dr. Marks singled out efforts by RFK to undermine the confidence in vaccines. This resignation comes after RFK announced the reduction of the healthcare department’s staff by roughly 20’000, or 25 %. On March 31, 4 other NIH directors were removed from their posts. While these developments are negative for sentiment and may slow down review and approval process for new drugs, we view the impact as limited and primarily affecting small-cap biotech stocks.

Performance review: The largest contributors were Agilon (+49 bps / Normalization of performance after a very weak 2024. Upbeat presentation at the Cowen Healthcare Conference in March), Hypera (+17 bps / Q4 top-line results were in-line with estimates, while EPS was better than expected. Importantly, channel inventory adjustment is happening faster than anticipated) and Centene (+14 bps / The company confirmed its 2025 guidance. Otherwise, the stock was hit by various policy-news (House GOP eying reduction to Medicaid targeted at the "expansion population" of the program / CMS rule focused on program integrity on the healthcare exchanges))

The largest detractors were Novo Nordisk (-80 bps / Announcement of top-line results from the Phase 3 REDEFINE 2 trial of CagriSema in individuals with obesity and type 2 diabetes. Over 68 weeks, patients receiving CagriSema experienced a 15.7% reduction in body weight, compared to 3.1% with placebo. The placebo-adjusted weight loss of 12.6% fell slightly below expectations but was comparable to the 12.3% seen with Eli Lilly’s Zepbound in the SURMOUNT-2 trial. Despite this, Novo Nordisk remains on track to seek regulatory approval in Q1 2026 and plans to present comprehensive data from the REDEFINE 1 and 2 trials at a scientific conference in 2025), Dexcom (-73 bps / Dexcom received an FDA-warning letter (non-conformities in manufacturing processes and quality management system) following inspections at two company facilities. The letter does not prevent Dexcom from manufacturing and selling its current products and the company confirmed 2025 guidance. The sell-off was further exacerbated due to overall Medtech weakness on tariff-fears) and Amplifon (-69 bps / Q4 results came in below expectations (primarily due to continued softness in Europe) and 2025 guidance (back-end loaded and wider than usual) was also lower than estimated).

ESG: Firms in the portfolio did not report any material ESG issues in March.

Market review: The healthcare sector widened its year-to-date outperforming through a strong reporting season, with 4.8% lead vs the market as of 28th Feb. Both sales and earnings growth outpaced the market year-on-year, indicating both strong underlying factors as well as margin expansion.

However, the Trump administration has been the source of much headline volatility over the past few weeks. This has affected specific areas ranging from federal grant funding to Medicaid funding and vaccines. 

Overall, these announcements have added an uncertainty premium to select names and sector areas. However, we view fundamentals as broadly unaffected.

Portfolio changes: We did not initiate a new position and no position was exited.

Performance review: The largest contributors were Axsome (+63 bps / The firm has entered into a settlement agreement with Teva resolving all patent litigation related to Axsome's AUVELITY product. Later, the stock was initiated with a buy rating by a major broker. After lower-than-expected Q4 results, Axsome gave up some performance, only to start performing again later in the month after announcing that the EMERGE Phase 3 trial of SYMBRAVO reached its primary endpoint. Overall, the stock gained 20% in February), Gilead (+59 bps / Q4 results were better than expected and outlook on EPS-level was higher than estimated. Gilead showed good performance across HIV, Trodelvy and liver disease portfolios) and Abbott (+28 bps / No specific news. Positive momentum from January continued in February).

The largest detractors were Tandem (-141 bps / Q4 sales were higher, and EBITDA was lower than consensus. The 2025 outlook was lighter than estimated and includes an EU commercial transition to direct distribution and an US commercial organization expansion that could cause disruption), Exact Sciences (-53 bps / Q4 revenues were in-line with the pre-announcement, while EBITDA was higher than consensus. 2025 guidance for revenues was in-line (with Cologuard to grow 13% vs earlier expectations of 15%), while margins fell short) and RadNet (-46 bps / Q4 results were better than expected and 2025 EBITDA-outlook was lower than consensus. However, fundamentals remain intact and guidance was impacted by two one-offs (winter storms and California fires) with volumes back to normal now).

ESG: Firms in the portfolio did not report any material ESG issues in February.