Fundamental Analysis

Investment Strategy

Aescap Life Sciences has a focused portfolio, investing in approximately 18 companies. Our investment decisions are based on thorough research and fundamental analyses. In the biotech sector such an analysis especially encompasses the product portfolio, patent protection, product development risks, market entry barriers, competition and the expected market development. But perhaps even more vital to our process are the serious efforts we undertake to understand the strengths and weaknesses of a company’s management, track record, their team dynamics, and their view on the future of the company and the markets they serve.

Next-Generation Medicine

We believe companies can truly make a difference if their products differentiate themselves from their competitors. We therefore do not invest in me-too products; instead we actively search for companies which develop next-generation medicines with a unique selling point.

Outstanding Management

In our experience a management team with the right characteristics consistently outperforms the market. To that end, we look for outstanding and ambitious management teams with an excellent track record and a clear vision on the future.

High Growth Companies

We only invest in those companies that are actively searching to expand their business in terms of in- or out-licensing opportunities around their product pipeline. These efforts do not only drive growth, they also reduce the company’s exposure to risk.

Diversification Within Our Focus

Our focus is on the highly specialized biotech and life sciences market. This is a market we understand and know very well due to our team’s decades of expertise in the field. Within this focused approach we diversify over diseases, geographies and stages of company development to limit risk and maximize profit.

Undervalued Companies

From a pool of over 800 listed Life Science companies in Europe and the U.S. we identify those companies that meet the above mentioned criteria and of which stocks are being traded at a significant discount to their intrinsic value. From these identified companies about 60 will be selected. These are our so called ‘working universe’. We believe in our ability to consistently outperform the market. We are able to do so by investing in a focused portfolio of 18 companies, based on a disciplined buy and sell strategy.

Buy and Sell Discipline

We actively monitor the companies that we identify as high potential. We invest in those companies when they meet our calculated ‘maximum entry prices’ and sell them when they have reached our re-balance price. This disciplined buy and sell approach allows us to make rational decisions, thereby avoiding the risk of going along with a bubble, and knowing when to step in when the bubble bursts. This results in making a significant return on investment and enabling the development of medical treatments that make a difference to patients and their doctors.

Concentrated Portfolio

We focus our efforts in finding future outperformers to maximize our returns. Rather than spreading our portfolio over a large number of investments and losing sight over individual investments, we hold a concentrated portfolio in which we only invest in around 18 companies at a time. This ensures we are consistently on top of developments as they occur within each of our chosen companies.

We Put Our Money Where Our Mouth Is

A stringent approach and staying true to our values has been the basis that led to our consistently profitable track record investing in medical companies. Our confidence in our unique strategy is reflected by the fact that the Aescap Life Sciences investment team has invested over €30 million in the fund.