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BB BIOTECH AG: Outlook for the biotech sector remains positive despite sell-off

BB BIOTECH AG / BB BIOTECH AG: Outlook for the biotech sector remains positive
despite sell-off. Processed and transmitted by NASDAQ OMX Corporate
Solutions. The issuer is solely responsible for the content of this
Publication of BB Biotech AG's Annual Report 2015

Further significant increase in dividend of 25% to CHF 14.50 per share,
five-for-one share split proposed

Amid last year's volatile market environment, the Nasdaq Biotech Index (NBI)
advanced 11.8% in USD while BB Biotech's share price gained 28.2% in CHF,
41.2% in EUR and 27.1% in USD over the year. The outperformance of the
benchmark index is attributable to BB Biotech's successful stock-picking.
Major performance drivers were new product launches, regulatory approvals,
positive clinical data and M&A activity. In line with the distribution policy
established in 2013, the Board of Directors will propose a dividend of CHF
14.50 per share at the Annual General Meeting, which represents a significant
increase of 25% compared to the previous year. BB Biotech will also propose a
five-for-one share split. In its outlook for 2016, the Investment Management
Team expects stock markets to remain highly volatile. In view of the growing
number of biotech products reaching the market and the expected clinical data
from late-stage drug candidates, the fundamentals for the biotech sector
remain positive. Moreover, the stock-market valuations of many companies have
subsided to attractive levels in the wake of the recent sell-off, which has
made them even more attractive takeover candidates for prospective buyers in
the pharmaceutical and biotech industries.

The Nasdaq Biotech Index (NBI) advanced 11.8% in USD in 2015, while the S&P
500 Index treaded water and ended the year with a gain of 1.4% in USD.
European stock markets, the Euro Stoxx 600 or the DAX, for example, gained
approximately 10% in EUR, buoyed by the significantly weaker currency. The
SMI's total return in 2015 was a slim +1.2% in CHF.

BB Biotech AG's shares clearly outperformed the benchmark index, rising by
28.2% in CHF, 41.2% in EUR and 27.1% in USD. BB Biotech's Net Asset Value
(NAV) rose by 19.0% in CHF, 31.6% in EUR and 18.0% in USD over the year. This
good performance was driven by several factors: the positive sector
developments, strong stock selection and ongoing high M&A activity. BB
Biotech AG closed 2015 with an after-tax profit of CHF 653 mn (previous year:
profit of CHF 1470 mn).

Dividend of CHF 14.50 per share proposed for 2015 fiscal year

In line with the distribution policy established in 2013, the Board of
Directors will propose a distribution of CHF 14.50 per share at the Annual
General Meeting on March 17, 2016, which corresponds to a 5% yield based on
the volume-weighted average price of BB Biotech shares in December 2015. This
marks another significant increase of 25% compared to the previous year. The
remaining paid-in capital reserves of around CHF 136 mn will be distributed
with the difference to be paid out as a regular dividend from retained

Five-for-one share split proposed

A five-for-one share split is being proposed in the light of BB Biotech's
strong performance of +461.4% (in CHF) over the past five years and the
positive prospects for its investment portfolio. The number of fully diluted
outstanding shares will increase from 11.85 million to 59.25 million,
excluding shares repurchased on the second trading line.

Portfolio changes in the fourth quarter and throughout 2015

Trading activity in the fourth quarter was significantly below prior quarters.
Three takeovers alone, Pharmacyclics, Synageva and Receptos, had a
significant impact on BB Biotech's portfolio and generated CHF 541 mn in cash
in the first nine months of 2015. The small holdings in Immunogen, Theravance
and Theravance Biopharma were also sold during the course of 2015. Meanwhile
BB Biotech added eight new small and mid-cap positions over the year and
increased many of its existing shareholdings.

The level of investment fluctuated in relation to the underlying sector
performance. At the beginning of 2015 BB Biotech's cash position was zero
whereas in the summer, when the biotech sector was trading at its high, the
cash position was about 5%. Afterwards, during the ensuing correction, BB
Biotech built up new investments and traded back into existing positions,
which led to an investment level of 104% by the end of the year.

At the end of 2015, BB Biotech's portfolio consisted of six core holdings,
each accounting for more than 5% of portfolio assets, namely Celgene, Incyte,
Ionis Pharmaceuticals (formerly Isis), Actelion, Gilead and Radius Health. BB
Biotech's investment portfolio comprises 34 positions in all.

Two new positions were added during the fourth quarter of 2015 - Sage
Therapeutics and Cidara Therapeutics. Sage is focused on central nervous
system (CNS) disorders with its lead pipeline candidate SAGE-547 under
development to treat super-refractory status epilepticus. Cidara is
developing novel anti-infectives, including their lead product CD101, a novel
molecule from the echinocandin class, for the treatment of systemic Candida

Progress for the portfolio companies continues

In the final quarter of 2015, three of BB Biotech's portfolio companies
announced product approvals in key markets. Gilead announced the US FDA
approval of Genvoya for the treatment of HIV-1 infected patients. Genvoya is
the first single tablet regimen containing tenofovir alafenamide (TAF) in
combination with elvitegravir, cobicistat and emtricitabine. As a next
generation tenofovir, TAF has been proven to match tenofovir's activity
against HIV-1 with significantly less side effects. Elocta reached approval
status by the European Commission and can be launched in all 28 member states
of the EU for treating patients with hemophilia A, both as prophylaxis and
on-demand treatment/application. Swedish Orphan Biovitrum will market Elocta
in Europe while its development partner Biogen will market the drug in the
US. Actelion received US regulatory nod to launch Uptravi, its novel orally
available prostacyclin receptor agonist. Uptravi (Selexipag) will complement
Actelion's market leading PAH product offering and allow the company to
sustain long-term top and bottom line growth.

Disappointingly, Clovis announced following its mid-cycle communication
meeting with the US FDA that the previously published and presented 60%
response rate for rociletinib, the company's mutant selective EGFR inhibitor
for the treatment of non-small cell lung cancer patients, did not hold up and
was confirmed to be about half that. Investors questioned both the
approvability as well the competitiveness of the drug in the case of
approval, leading to a significant correction in the company's market

As a significant positive, Neurocrine announced positive Phase III data for
NBI-98854 in tardive dyskinesia patients. The VMAT2 inhibitor showed a
statistically significant reduction in tardive dyskinesia during six weeks of
placebo-controlled treatment. The company has applied for a regulatory review
and is expecting product approval in late 2016.

Besides the approvals and clinical data read-outs, there were other headlines
on the biotech sector. Celgene, for example, announced the settlement of the
Revlimid patent litigation with Natco Pharma and Allergan. The settlement
terms give Natco unrestricted access to the US market from January 31, 2026
and "volume-limited" marketing rights as of March 2022. The settlement is
positive for Celgene because it effectively protects its patent estate for
Revlimid and allows Celgene to continue its diversification and growth
strategy for many years to come.


In its outlook for 2016, BB Biotech expects more announcements of regulatory
approvals as well as strong pipeline newsflow from its portfolio companies.
Merger and acquisition activity was an important performance driver in 2015
and BB Biotech's Investment Management Team expects more large deals to come.
As for the macroeconomic environment, management expects volatility to climb
higher over the next few quarters, triggered by diverging central bank
monetary policy and election news in the US.

Major product approvals likely to be announced by BB Biotech's portfolio
companies in 2016 are:

* Uptravi for treating pulmonary arterial hypertension patients (Actelion) by
* OCA for the treatment of primary biliary cirrhosis (Intercept)
* TAF containing HIV medications (Gilead)
* Sovaldi/Velpatasvir combo for HCV (Gilead)
* Ataluren for Duchenne muscular dystrophy patients (PTC Therapeutics)
* Valbenazine for the treatment of tardive dyskinesia patients (Neurocrine)
* EU decision on Abaloparatide for treating osteoporosis (Radius)

Furthermore, updates in key clinical programs are expected for literally all
portfolio holdings. BB Biotech's portfolio consists of established,
profitable firms with attractive valuations and on highly innovative small
and mid-caps. Thanks to this diversity, the Investment Management Team
believes it is well positioned to capture many of the important
value-creating sector milestones in 2016.

BB Biotech's annual report as of December 31, 2015, is available

For further information:

Investor Relations

Bellevue Asset Management AG, Seestrasse 16, 8700 Küsnacht, Switzerland, phone
+41 44 267 67 00
Dr. Silvia Schanz,ssc@bellevue.ch
Maria-Grazia Iten-Alderuccio,mga@bellevue.ch

Claude Mikkelsen,cmi@bellevue.ch

Media Relations

Bellevue Asset Management AG, Seestrasse 16, 8700 Küsnacht, Switzerland, phone
+41 44 267 67 00
Tanja Chicherio,tch@bellevue.ch

b-public AG, Pfingstweidstrasse 6, 8005 Zürich, Switzerland, phone +41 79 423
22 28
Thomas Egger,teg@b-public.ch


Company profile

BB Biotech invests in companies in the fast growing market of biotechnology
and is one of the world's largest investors in this sector. BB Biotech is
listed in Switzerland, Germany and Italy. Its investments are focused on
listed companies that are developing and commercializing novel medical
treatments and cures. BB Biotech's investment selection process is guided by
the fundamental research and analysis of physicians and molecular biologists.
Its Board of Directors has many years of experience in industry and science.


This release contains forward-looking statements and expectations as well as
assessments, beliefs and assumptions. Such statements are based on the
current expectations of BB Biotech, its directors and officers, and are,
therefore, subject to risks and uncertainties that may change over time. As
actual developments may significantly differ, BB Biotech and its di...

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