COVID-19 vaccine, U.S. Presidential election and more

We are pleased to present International Biotechnology Trust’s factsheet for July 2020:

https://ibtplc.com/news/ibt-fact-sheet-july-2020/

The development of a vaccine for the prevention of the COVID-19 infection is moving forward in the U.S. at impressive speed and the UK government is not far behind under the leadership of the chair of the UK’s Vaccine Taskforce, Kate Bingham, who is also an Investment Manager of the International Biotechnology Trust. Of course, we are extremely proud of Kate and the important work she is doing for the public health of the population of the United Kingdom. For more information please refer to the following link:
https://www.gov.uk/government/news/kate-bingham-appointed-chair-of-uk-vaccine-taskforce

Without going into the detailed results of the various vaccines in development, there is growing data to support that one or more vaccine developers will have a vaccine approved in the first half of 2021. The results of the early ongoing vaccine trials are widely documented and information on the latest trial results is readily available to the general public. In my opinion, as an immunologist and medical doctor, I am encouraged by what I see. I am increasingly optimistic about the possibility that the worldwide efforts to develop a vaccine will be successful and faster than we initially anticipated.

The elections in the U.S. are always important for the general equity markets and for the healthcare sector, in particular. This year is no different. In 2016, the Presidential debate focused more on the drug pricing itself, with Hillary Clinton running as candidate for the Democratic Party. This year the Democratic Candidate is Joe Biden, who is considered to have a more "moderate" view on healthcare reform. His message centres on providing the average American with access to affordable healthcare, rather than focusing on drug pricing (for more information, please refer to: https://joebiden.com/healthcare/#). Our view is that this will not have a significant negative impact near term on the healthcare and biotech sectors.

We have seen a strong recovery of the equity markets including the biotech sector after the trough experienced during March 2020. At the end of July 2020, the Nasdaq Biotech Index (NBI in USD) stood at 4,224, a number exceeding the NBI’s peak five years ago on 20 July 2015, at 4,165. The biotech sector is experiencing a strong innovation cycle with an increasing rate of scientific discoveries and a growing number of new pharmaceutical drugs in development. Interest rates are low as part of the monetary policy expansion, following a concerted global effort to respond to the pandemic. However, with many factors at play - the pandemic, US politics, vaccine development, etc, the near-term development could be a bit volatile. In the longer term, we are convinced that this innovative productivity will lead to an increased number of life-saving products which will translate into increased global sales and earnings.