Difficult fourth quarter for BB BIOTECH

1/28/2008, 7:25 PM (Source: GlobeNewswire)
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Corporate news announcement processed and transmitted by Hugin ASA.
The issuer is solely responsible for the content of this
announcement.
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During 2007, most biotech stocks experienced a mixed and fluctuating
share price performance. The biotech market performed favorably until
October, when major companies, including a string of our core
holdings, suffered significant setbacks with depressed valuations for
the last two months of the year. Consequently, during the last
quarter, BB BIOTECH experienced a significant decline in share price,
ending the year at CHF 89, down 6.8% (in CHF, including dividend). We
believe this sequence of "news events" represents an unusual
circumstance and the sector remains very attractive.

Operationally, our portfolio companies once more delivered strong
performances, including commercial progress and important pipeline
developments.

Our core holding Actelion achieved an impressive growth rate of 30%
for Tracleer. Despite this strong performance, financial markets
worried about the potential threat of a new competitor. This
triggered a substantial decline of Actelion's share price. We do not
agree with the negative sentiment. Given Tracleer's proven long-term
efficacy and safety record, we continue to expect Tracleer revenues
to grow and Tracleer to remain a cornerstone of therapy in Pulmonary
Arterial Hypertension (PAH). Furthermore, Actelion moved two
important development projects, Almorexant for insomnia and
Actelion-1 for PAH, into Phase III studies, the final stage of
clinical development.

Gilead continued strong performance, based on its market leading
position in the treatment of HIV. Furthermore, in June, Gilead
received US marketing approval for the new drug Letairis for
treatment of PAH, and achieved significant progress with several of
its pipeline products.

Celgene executed the launch of its key product Revlimid successfully.
Strong clinical data regarding the use of Revlimid in several
hematological cancers were presented at the annual meeting of the
American Society of Hematology in December, indicating unprecedented
efficacy at 2-years as measured by the survival of patients with
Multiple Myeloma. However, due to competitor data, Celgene's stock
declined following the conference. Despite this, we remain confident
that Revlimid will become the gold standard for treatment of various
cancers, due to its efficacy, favorable safety profile, and its
convenience as an oral therapy for the patients. Also due to concerns
of regarding competition, our shares in Vertex declined in value,
regardless of the fact that Vertex's drug Telaprevir, for treatment
of Hepatitis C, is significantly ahead of all potential competitors
in clinical development.

Biogen Idec appreciated significantly during the year, driven by
strong operational performance, in particular strong demand for its
product Tysabri for Multiple Sclerosis. In October, Biogen Idec's
board initiated a process to sell the company. That process was
concluded in December when Biogen Idec announced their intention to
go forward as an independent company.

The industry's bellwether Genentech, one of our most important
holdings, suffered a setback when an advisory committee of the US
Food and Drug Administration (FDA) rejected the request for expanded
approval of its blockbuster product Avastin. The antibody Avastin is
already approved for colorectal and lung cancer. The advisory panel
was ambivalent regarding treatment of metastatic breast cancer, due
to data gaps in the submitted clinical study, which was conducted by
independent oncologists. However, additional studies by Genentech and
Roche are ongoing, with clinical results expected in 2008, which
might be used as supplementary data for the FDA.

Of the many existing biotech drugs in development, the new drugs for
treatment of Alzheimer's Disease (AD) promise outstanding potential,
in medical, social and economic respects. Our holding in Elan
Pharmaceuticals performed very well during 2007, following the
announcement that its antibody for treatment of AD will move into
clinical development Phase III in December 2007.

During 2007, we invested in new positions, including NicOx, Optimer
Pharmaceuticals and Jerini. We divested holdings in Amgen, Genzyme,
Basilea Pharmaceutica, Anadys and Affymax.

The discount - the difference between the share price and the Net
Asset Value of BB BIOTECH - narrowed further to 3.8% (in CHF) at the
end of the year. Our share buy back program and the cancellation of
1.4 million shares contributed to the positive development.
Consistent with the dividend model we introduced in 2004, the Board
of Directors will propose at the annual shareholder's meeting to pay
a dividend of CHF 0.90.

Due to the strong growth of the revenues and earnings of the
biotechnology companies, valuation parameters like P/E ratios have
decreased to attractive levels, which makes us very optimistic that
BB BIOTECH will return to its long-term, double-digit growth
trajectory.

This is the composition of BB BIOTECHs' Portfolio as at December 31,
2007:

CORE HOLDINGS
Actelion 26.6%
Gilead 14.5%
Celgene 13.0%
Genentech 11.8%
Biogen Idec 6.6%

SMALL PARTICIPATIONS
Vertex Pharmaceuticals 6.4%
Elan 6.1%
Roche Holding GS 3.3%
Affymetrix 2.6%
Zymogenetics 2.4%
The Medicines Company 1.6%
NicOx 0.9%
BioXell 0.8%
Jerini 0.6%
Incyte 0.5%
Rigel Pharmaceuticals 0.5%
Keryx Biopharmaceuticals 0.4%
Arena Pharmaceuticals 0.4%
Optimer Pharmaceuticals 0.3%
Epigenomics 0.1%

Genentech Call-Optionen (long) <0.1%
SWAP Agreement on own shares 0.4%

Total securities CHF 2 037 Mio.
Treasury shares (in % of company) 11.7%
Liquid funds (net) CHF (173.4) Mio.
Other assets 23.6 Mio.
Other payables CHF (119.6) Mio.


The annual report will be available on www.bbbiotech.com as of March
13, 2008.
For further information please contact:
Bellevue Asset Management AG, Seestrasse 16, 8700 Küsnacht,
Switzerland
Anja Stubenrauch, Tel. +41 44 267 67 00



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BB BIOTECH AG
Vordergasse 3 Schaffhausen Switzerland

WKN: 888509;
ISIN: CH0001441580; Index: SBIOM, IGSP, SLIFE;
Listed: Investment Companies in SWX Swiss Exchange;
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