REG - Intnl. Biotechnology - Half-year Report
12/05/2026 07:00
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RNS Number : 8564D Intl. Biotechnology Trust PLC 12 May 2026
INTERNATIONAL BIOTECHNOLOGY TRUST PLC
HALF YEAR REPORT FOR THE SIX MONTHS ENDED
28 FEBRUARY 2026
International Biotechnology Trust plc (the "Company") hereby submits its Half
Year Report for the six months ended 28 February 2026 as required by the
Financial Conduct Authority's Disclosure Guidance and Transparency Rule 4.2.
Key Highlights
· Performance during the six-month period was strong, generating a
double-digit positive return for shareholders. The Company's share price
produced a total return of 39%, outperforming the Reference Index, which
delivered a total return of 29.5%.
· The Company paid a first interim dividend for the year ending 31
August 2026 of 15.64 pence per share. As at 28 February 2026, the Company's
dividend yield was 3.2%.
· The Portfolio Managers continue to focus on late-stage,
high-growth biotechnology companies which continue to offer long-term
potential at attractive valuations. These may also attract strategic interest
from larger pharmaceutical firms seeking innovative assets to replenish their
development pipelines.
Kate Cornish-Bowden, Chair of International Biotechnology Trust plc,
commented:
"It has been gratifying to witness a rebound in the biotechnology sector
following a significant sell off. The relative outperformance has been
sustained by exciting innovation, a higher number of successful FDA approvals
and increasing evidence of M&A activity.
In this environment, the more profitable, later stage, commercial
biotechnology companies in which the portfolio is overweight should prove to
be more resilient. This is borne out by the continued M&A activity since
the period end with a further three acquisition announcements of portfolio
companies in March 2026 alone."
The Half Year Report is also being published in hard copy format and an
electronic copy of that document will shortly be available to download from
the Company's web pages at www.ibtplc.com (http://www.ibtplc.com/) .
The Company has submitted a copy of its Half Year Report to the National
Storage Mechanism and it will shortly be available for inspection
at https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) .
Enquiries:
Schroder Investment Management Limited
Charlotte Banks / Kirsty Preston (Press) 020 7658 6000
Natalia de Sousa / Michelle Taiwo (Company Secretarial) 020 7658 6000
Chair's Statement
Dear Shareholders
I am very pleased to report that the share price total return of International
Biotechnology Trust plc (the "Company") rose by 39% during the six-month
period under review, comfortably outperforming the Nasdaq Biotechnology Index
(NBI), (the "Reference Index"), which delivered a total return of 29.5% over
the period. The Company's net asset value (NAV) total return rose by 35.7% per
share, reflecting a narrowing of the discount at which the share price traded
to NAV; from 8.9% at the end of August 2025 to 6.7% as at 28 February 2026.
It has been gratifying to witness a rebound in the biotechnology sector
following a significant sell off. The relative outperformance has been
sustained by exciting innovation, a higher number of successful Food and Drug
Administration (FDA) approvals and increasing evidence of merger and
acquisition (M&A) activity.
Quoted portfolio
During the six months under review, the NAV per share of the quoted portfolio
returned 39.4%(1) (gross of management and performance fees) significantly
outperforming the Reference Index, which delivered a NAV total return of
29.5%. Following a prolonged period of relative underperformance, the
biotechnology market rebounded strongly as investors anticipated a lower
interest rate environment. As fears around regulation and political changes at
the FDA receded, a surge in M&A activity added further momentum.
1 Source: Schroders.
Your Portfolio Managers, Ailsa Craig and Marek Poszepczynski, have continued
to be successful in identifying the target biotechnology companies likely to
appeal to large pharmaceutical firms looking for products to replenish their
pipelines. A further five investment holdings were subject to takeover bids
during this period, bringing the total number of portfolio companies acquired
since 2020 to 35.
The biggest contributor to performance over the period came from the
Netherlands-listed company, uniQure. In September 2025, uniQure received an
FDA accelerated approval pathway for its gene therapy for Huntington's
disease, leading to a 250% rise in the share price. The Portfolio Managers'
decision to take profits and sell the position proved prescient as the FDA
subsequently reversed its decision and the share price halved.
Vera Therapeutics was another significant contributor to performance. The
share price of the company rallied at the end of 2025 when the company
reported positive Phase 3 clinical trial results from its therapy for
immunoglobulin A nephropathy (IgAN), a chronic autoimmune kidney disease. An
FDA approval decision is expected in the middle of this year which should
enable Vera to move to commercial launch.
Another significant performance contribution came from the oncology company
Terns Pharmaceuticals which announced positive clinical trial results for its
treatment targeting chronic myeloid leukaemia. The news in late 2025 led to a
soaring share price indicating investor enthusiasm in this area of high unmet
medical need. Since the period end, Terns has announced that it has received a
bid from Merck, another large pharmaceutical company which is seeking products
to replace the blockbuster Keytruda which comes off patent in 2028.
The biggest detractor from performance was Soleno Therapeutics which has
recently launched a treatment for the rare genetic disorder Prader-Willi
syndrome. The launch has been impacted by some stories of adverse side effects
and high discontinuation rates which has dampened commercial expectations and
led to share price declines.
Unquoted portfolio
It is the Board's intention to maintain 5 - 15% of the Company's assets in
unquoted, early-stage innovative biotechnology opportunities, accessed through
unlisted funds not easily directly available to retail investors.
At the period end, the unquoted portfolio, which represented 7.3% of the
Company's total investments, was invested primarily in two venture capital
funds managed by SV Health Investors LLP: SV Fund VI and SV Biotech Crossover
Opportunities Fund (SV BCOF). There was also a small initial investment in a
venture capital fund under the new Schroders Capital partnership announced in
October last year.
SV Fund VI
As at 28 February 2026, SV Fund VI represented 2.5% of total investments, down
from 3.1% at the end of August 2025. SV Fund VI, which invests across
early-stage biotechnology, medical device and healthcare services companies,
is now in run-off and is gradually returning capital to shareholders. During
the period, SV Health co-led an oversubscribed fundraising to support Artios
Pharma accelerate clinical programmes in therapeutics to treat pancreatic,
colorectal, and breast cancers. Since the Company's initial investment in
2016, SV Fund VI has performed well, delivering a net internal rate of return
(IRR) of 13.7% as at 31 December 2025.
SV BCOF
SV BCOF represented 3.2% of total investments at the period end. The $30
million commitment was 65% drawn down as at 28 February 2026. Financing
conditions in the pre-IPO market remain challenging and SV Health has
continued to deploy follow-on investments cautiously. During the period under
review, the Company received a further milestone distribution from the
recently exited EyeBio, and BioAge Labs, the listed, oral anti-obesity
company, was sold following a recovery in the share price. Sitryx Therapeutics
commenced Phase 1 trials in an oral immunomodulator for atopic dermatitis, and
Nimbus Therapeutics announced positive results from its Werner syndrome
protein (WRN) inhibitor for patients with certain resistant cancer tumours in
Phase 1/2 dose escalation trials. Pulmocide had disappointing results and
terminated a Phase 3 study in an inhaled treatment for respiratory disease. As
at 31 December 2025, SV BCOF has delivered a net IRR of 79.9% since inception
in 2022, a very strong performance, albeit still early in the life of this
venture capital fund.
Schroders Capital
Following the announcement in the third quarter of 2025, the Company has
committed £10 million to the new partnership with Schroders Capital ("SC").
As at the end of February 2026, 20% of the committed capital has been drawn,
representing approximately 0.6% of the Company's total investments. The
partnership has made a single $6.7 million commitment to a biotech crossover
fund that invests in clinical stage companies developing novel therapeutics.
As at 31 December 2025, the fund has delivered a net IRR of 5.3%.
The portfolio also includes a small number of directly held unquoted
companies, most of which have been exited, with potential contingent milestone
payments still outstanding. Of the remaining legacy holdings, the most
significant is the discounted value of royalty streams from Ikano
Therapeutics. This holding was sold to Belgian listed UCB in 2006; this
holding represented 0.7% of total investments at 28 February 2026.
Dividends
The Company's dividend policy, which was last approved at the Annual General
Meeting (AGM) held in December 2025, is to make dividend payments equivalent
to 4% of the Company's NAV as at the last day of the preceding financial year
ending 31 August, through two semi-annual distributions. The first interim
dividend, for the year ending 31 August 2026 of 15.64 pence per share, was
paid on 23 January 2026. As at 28 February 2026, the dividend yield for the
Company was 3.2%. The Board intends to declare the second dividend for the
year, in accordance with the above policy, in July 2026 for payment in August
2026.
Discount management
The share price discount to NAV was 6.7% as at 28 February 2026, which
narrowed from a 8.9% discount at the end of the 2025 financial year. The Board
continues to keep the Company's share price discount to NAV under close review
and is committed to buying back its shares to help manage the position. During
the period, the Board bought back 1,824,657 shares to be held in treasury. The
Board believes that buying back shares at a discount to NAV is not only
accretive to our shareholders but demonstrates our confidence in the
underlying fundamental value of our investments.
Costs and fees
Outperformance of both the quoted and unquoted portfolios for the six-month
period, led to a performance fee of £1,452,000 accruing. In respect of the
quoted portfolio, a performance fee of £1,406,000 accrued to the Manager
whilst a fee of £46,000 has also accrued to SV Health in respect of the
performance of the unquoted portfolio.
Outlook
As I write, we have now witnessed two months of war in the Middle East. The
distressing humanitarian cost, and the global economic costs of rapidly rising
energy prices and supply chain disruption, are showing no real sign of
abating. Market volatility has increased significantly as the outlook for
inflation and interest rates deteriorates. The promising signs of a resurgence
in interest in the biotechnology sector evident at the half-year end have
stalled, as investors search for areas of the market perceived as less
volatile.
In this environment, the more profitable, later stage, commercial
biotechnology companies in which the portfolio is overweight should prove to
be more resilient. Rising interest rates will undoubtedly have an impact on
the funding environment for earlier stage innovative biotechnology companies.
The positive fundamental aspects of the sector are unchanged; namely the
ageing demographic, the significant strides in scientific innovation and the
appetite for defensive cash-rich pharmaceutical companies to acquire new
treatments to replace sales of products facing patent expiry. This is borne
out by the continued M&A activity since the period end with a further
three acquisition announcements of portfolio companies in March 2026 alone.
Schroders combination with Nuveen
On 12 February 2026, the Board of Schroders plc announced that it had agreed
the terms of a recommended cash acquisition by Nuveen LLC, to combine the two
businesses. The transaction is not expected to complete until Q4 2026. The
Board will continue to monitor the impact of the transaction.
Further details are available on the Schroders website:
https://www.schroders.com/en/global/individual/nuveenoffer/
(https://www.schroders.com/en/global/individual/nuveenoffer/) .
Kate Cornish-Bowden
Chair
11 May 2026
Portfolio Managers' Report
We are pleased to present the Portfolio Managers' Report for the six months
ended 28 February 2026. The Company delivered a strong performance during the
period, as improving sentiment across the biotechnology sector supported a
broad recovery in share prices, with the best performance coming from
businesses exhibiting the characteristics we favour.
The Company's net asset value (NAV) per share increased by 35.7% during the
period, compared with a return of 29.5% for the NASDAQ Biotechnology Index
(NBI). During the period under review, the Company's share price rose by 39%,
while the discount to NAV narrowed from 8.9% to 6.7%.
Market overview
Biotechnology equities performed strongly during the period, supported by
improving policy clarity in the United States. Earlier in 2025, the sector had
faced considerable uncertainty around the policy priorities of President
Trump's new administration, including its approach to trade. Within
healthcare, the administration's proposals for 'Most Favoured Nation' (MFN)
drug-pricing reforms that would link US prices more closely to those in other
developed markets, and plans for a significant headcount reduction at the US
Food and Drug Administration (FDA) were a headwind for the sector. These
issues came to a head following the 'Liberation Day' tariff announcements in
April 2025, which triggered a significant market sell-off.
Policy clarity had already begun to emerge towards the end of the Company's
last financial year and gathered pace during the period under review.
Negotiations between the US government and several large pharmaceutical
companies helped reduce uncertainty surrounding MFN implementation, easing
investor concerns that had weighed on the healthcare sector as a whole.
Meanwhile, fears that changes at the FDA would hamper its ability to maintain
the rate of new drug approvals have also proved unfounded, with the agency
approving 55 new medicines during 2025, around 70% of which originated from
biotechnology companies. Media coverage of the FDA situation has remained a
source of volatility, but the continued flow of approvals has reinforced
confidence in the sector's ability to continue bringing innovative new
treatments to market.
Strategic activity from large pharmaceutical companies was another important
driver of market performance and a key tailwind for the Company's strategy.
Many pharmaceutical businesses face significant patent expiries in the coming
years and remain focused on identifying innovative therapies capable of
replacing revenues set to be lost to generic competition. Although the logic
for mergers and acquisitions (M&A) is strong, dealmaking had been
relatively subdued earlier in 2025 amid the policy uncertainty described
above. As clarity emerged, takeover activity accelerated, driving share price
gains for the specific bid targets and lifting sentiment more broadly.
Capital markets activity also showed signs of improvement. Equity issuance
remained healthy, with capital generally available for high-quality biotech
assets. While initial public offering (IPO) activity was relatively subdued,
the pipeline of potential biotech listings appears more encouraging than it
has for some time.
Performance was particularly strong among late-stage high-growth biotechnology
companies, which outperformed their largest peers as investor confidence
improved. This proved beneficial to the Company, given the portfolio's focus
on biotechnology companies that are fast approaching commercialisation,
alongside its limited exposure to the larger, already profitable biotechnology
businesses that are significant constituents of the NBI.
The Company also benefited directly from the renewed M&A activity, with
five portfolio companies receiving takeover offers, as described below.
With regards to our earlier stage investments, we continue to use a basket
approach when investing in product areas where the technologies are unproven
and several companies are seeking to address a similar disease area. Our
approach is to take small holdings in a range of similar companies, with the
aim of increasing exposure to the most likely successes at the expense of
those we expect to fall behind or fail. Our current baskets focus on rare
diseases, metabolic companies such as those focused on obesity and the central
nervous system (mainly mental health).
Quoted portfolio performance review
The NAV of the quoted portfolio increased by 39.4%(1) (gross of management and
performance fees) during the period, outperforming the NBI, which returned
29.5%.
1 Source: Schroders.
Mergers and acquisitions
The Company benefited from five portfolio company acquisitions during the
period under review.
89bio, which is developing treatments for serious liver diseases, agreed to be
acquired by Roche in September 2025 in a transaction valued at up to $3.5
billion, which resulted in an 80% increase in the share price. The holding
represented around 0.5% of the Company's portfolio prior to the announcement.
The company's lead therapy, pegozafermin, targets non-alcoholic
steatohepatitis (NASH), an advanced form of fatty liver disease.
Also in September 2025, Pfizer agreed to acquire Metsera, a clinical-stage
biotechnology company developing therapies for obesity and cardiometabolic
diseases. The offer comprised $47.50 per share in cash together with a
potential further $22.50 per share tied to three clinical and regulatory
milestones, representing a premium of up to 110% to the company's share price
ahead of the bid. The holding represented around 1.1% of the Company's NAV at
that time.
The third deal in September 2025 involved oncology company Merus agreeing to
be acquired by Genmab, in an all-cash transaction valued at approximately $8
billion. The agreed offer price of $97 per share represented a premium of
around 40% to its undisturbed share price. The holding represented
approximately 0.3% of the Company's NAV before the deal. Merus' lead asset,
petosemtamab, is a late-stage therapy for the treatment of head and neck
cancers.
Akero Therapeutics, a clinical-stage biotechnology company focused on
metabolic diseases, agreed to be acquired by Novo Nordisk in October 2025 in a
transaction valued at up to $5.2 billion. The agreed offer of $54 per share in
cash, together with a potential further $6 per share linked to future
regulatory milestones, represented a premium of 42% to its closing price prior
to deal speculation emerging in May 2025. The holding represented
approximately 2.9% of the Company's NAV at the time of the announcement.
Also in October 2025, Avidity Biosciences, which is developing RNA-based
therapies for rare neuromuscular diseases, agreed to be acquired by Novartis
in a transaction valued at approximately $12 billion. The agreed offer of $72
per share in cash represented a premium of around 46% to the company's
undisturbed share price. Avidity's platform technology is designed to deliver
RNA therapeutics directly to muscle tissue, with several late-stage programmes
targeting genetic neuromuscular disorders. Avidity represented 2.6% of the
Company's NAV at the time of the announcement.
Thirty five of the Company's portfolio holdings have been acquired since 2020,
which highlights our continued ability to identify companies developing
differentiated therapies that are attractive to larger industry participants.
Other positive contributors to performance
Several holdings delivered strong clinical and operational progress during the
period under review.
uniQure, a gene therapy company developing treatments for severe genetic
disorders, performed strongly at the start of the period following the release
of encouraging clinical data for its lead programme, AMT-130, a potential
treatment for Huntington's disease. This triggered a sharp rally in the shares
during October 2025, providing us with an opportunity to lock in gains by
significantly reducing our holding. The shares subsequently retracted later in
the period after regulatory feedback. The FDA deemed the existing data not to
be adequate to warrant a submission for approval, which was a controversial
and much debated change of stance from the regulatory agency. Additional data
may be required before a future regulatory submission can proceed.
Vera Therapeutics was another strong contributor. The company is developing
atacicept, a therapy for immunoglobulin A nephropathy (IgAN), a chronic
autoimmune kidney disease that can ultimately lead to kidney failure. In
November 2025, the company reported positive Phase 3 results, which supported
strong share price performance during the period. Atacicept targets the
underlying immune drivers of the disease rather than simply managing its
symptoms, positioning it among a new generation of disease-modifying therapies
for this condition. With an FDA decision expected in July 2026, the programme
is now approaching a key regulatory milestone as the company transitions from
late-stage development towards commercialisation.
Terns Pharmaceuticals also performed strongly. Its lead programme, TERN-701,
targets chronic myeloid leukaemia, a type of cancer that develops in the bone
marrow, by inhibiting the abnormal gene (BCR-ABL) that drives the disease. In
November 2025, the company reported encouraging clinical data from an
early-stage study, strengthening confidence that the programme could offer
improved efficacy, tolerability and ease of use compared with existing
treatments. These results supported a sharp re-rating in the shares during the
period as investors gained confidence in the programme's progression towards
pivotal Phase 3 trials.
Negative contributors to performance
By contrast, a small number of holdings detracted from performance during the
six months ended 28 February 2026.
Soleno Therapeutics was a detractor during the period. The company develops
treatments for rare diseases and its lead therapy, Vykat XR, is approved for
the treatment of Prader-Willi syndrome, a genetic disorder characterised by
severe and persistent hunger. The shares had performed strongly in recent
years as the programme progressed towards commercialisation. Regulatory
approval was granted in March 2025, however, following reported safety events,
the shares have given up some of those gains and expectations for the launch
are tempered. This muted performance came despite Soleno reporting its first
ever profitable quarter in November 2025.
Meanwhile, Janux Therapeutics also detracted from performance. The company is
developing next-generation immunotherapies designed to direct T-cells to
attack cancer cells, with its lead programme, JANX007, targeting advanced
prostate cancer. In December 2025, the company reported updated Phase 1
clinical data, which demonstrated anti-tumour activity and a manageable safety
profile, but the efficacy appeared less compelling than investors had hoped,
prompting a share price decline.
Zai Lab's shares were hit during the period. The company develops and
commercialises innovative therapies across oncology, immunology and infectious
disease. In November 2025, its third-quarter results fell short of
expectations, and the company lowered its full-year revenue guidance, driven
largely by weaker-than-expected sales of its oncology product Zejula, amid
increased competition.
Unquoted portfolio performance review
SV BCOF
SV BCOF is designed to include investments in companies with therapeutics in
the clinic and/or closer to valuation realisation through strategic
transactions, acquisition or listing. SV BCOF is a 2022 vintage fund investing
in clinical or near clinical-stage biotechnology opportunities. As at 31
December 2025, the fund has delivered an excellent performance, with a net
internal rate of return (IRR) of 79.9% (noting that performance remains at an
early stage in the fund's life).
The Company's $30 million commitment is 65% drawn (excluding recallable
amounts) as at 28 February 2026, compared with 60% drawn (excluding recallable
amounts) as at 31 December 2025. The fund's investment period ended on 10
February 2026, and therefore remaining capital will now be deployed into
existing portfolio companies to help them reach value-generating milestones
and, ultimately, exit.
During the period under review, Sitryx Therapeutics initiated a Phase 1
clinical trial for its lead candidate SYX-5219, a first-in-class oral PKM2
modulator. The company has reported that SYX-5219 can generate a
dose-dependent reduction in TARC, a well-established biomarker of type 2
inflammation, providing encouraging early clinical evidence of appropriate
immunomodulatory activity. Also during the period, Sitryx signed a licensing
agreement with Boehringer Ingelheim totalling up to $500 million in upfront
and milestone payments, plus tiered royalties, representing a notable
validation event for the programme.
Nimbus Therapeutics, a portfolio company which previously delivered a 7x
return to SV BCOF through the 2022 acquisition of its potentially
best-in-class TYK2 inhibitor by Takeda (via the Lakshmi subsidiary), continues
to advance its remaining pipeline of therapeutics which may address multiple
large cancer and auto-immune indications with significant unmet need. During
the period, Nimbus finalised a $1.3 billion collaboration with Eli Lilly &
Co focused on developing oral therapies for obesity and metabolic diseases.
Not all developments were positive. Pulmocide terminated the opelconazole
Phase 3 pivotal study following an interim analysis showing a numerically
lower favourable response rate and numerically higher mortality rate in the
opelconazole arm compared to the control arm. These disappointing results are
inconsistent with previous data, and Pulmocide is undertaking a thorough
review of the unblinded data to determine potential next steps for the
programme.
Distributions during the period (September 2025 to February 2026) totalled
$20.1 million at the fund level, with the Company's share $2.3 million. These
distributions were received from the EyeBio escrow release (EyeBio was created
by SV Health Investors alongside SV Venture Partner and serial entrepreneur
David Guyer in 2021 and was sold to Merck & Co for up to $3 billion in
total; to date $1.5 billion has been paid in upfront and early milestone
payments) and from a partial exit of BioAge Labs via the public markets. As
previously reported, BioAge discontinued its STRIDES study of azelaprag due to
elevated liver enzymes, which led to a material share price decline. However,
the company retained exposure to additional pipeline assets, including
BGE-102, an orally available, brain-penetrant NLRP3 inhibitor, which was in
Phase 1 clinical development as at Q4 2025. In Q4 2025, BioAge's share price
rallied on improved sentiment for obesity programmes and positive clinical
read-through from a competitor programme on the same target. SV partially
exited during Q4 2025 and, following the end of the reporting period, sold the
remainder of its holding and fully exited the company in Q1 2026.
SV Fund VI
SV Fund VI, launched in 2016, is now in run-off mode and is gradually
returning capital to shareholders. During the period under review, SV Health
has continued to support the SV Fund VI portfolio with a follow-on investment
made to Artios Pharma. Despite the continued uncertainty in the funding
environment for unquoted companies and ongoing pressure on private valuations,
SV Fund VI has performed well. As at 31 December 2025, the fund reported a net
IRR of 13.7%.
Schroders Capital
Following the announcement in October 2025, the Company has committed £10
million to the new partnership with Schroders Capital ("SC"), called SC IBT.
SC IBT remains in the early stages of development, having made its first
commitment at the end of Q3 2025. As of 28 February 2026, SC IBT has made a
single $6.7 million (£5 million) commitment to a biotech crossover fund that
invests in companies developing novel experimental therapeutics, prioritising
on crossover investments in private companies and structured investments in
listed companies with a geographic focus on North America. As at 31 December
2025, SC IBT has delivered a net IRR of 5.3%.
Portfolio positioning
The portfolio continues to be managed using a combination of top-down analysis
and bottom-up stock selection, allowing our strategy to evolve as market
conditions change.
For example, in 2021 we had positioned the portfolio towards larger cash flow
generating biotechnology companies, as elevated valuations among earlier-stage
businesses and a more uncertain market backdrop led us to believe that
businesses with established commercial products and stronger balance sheets
would perform best.
Since mid-2022, this positioning has gradually reversed, with the portfolio
increasing its exposure to small and mid-cap companies as valuations have
become more attractive.
The portfolio remains focused on late-stage, high-growth biotech companies,
and many of them now represent clinically de-risked opportunities, with
late-stage development programmes or early commercial products. In our view,
this part of the market continues to offer long-term potential at attractive
valuations, which may also attract strategic interest from larger
pharmaceutical companies seeking innovative assets to replenish their
development pipelines.
While our portfolio positioning was broadly supportive for most of the period
under review, there have been signs that larger-cap biotechnology companies
are returning to favour in early 2026. This is supported in part by flows from
investors rotating out of large-cap technology stocks and may also reflect
safe haven demand amid heightened geopolitical tensions in the Middle East.
However, from a fundamental perspective, we continue to believe that the most
compelling opportunities remain among late-stage development and recently
commercialised biotechnology companies. Valuations across this part of the
market remain attractive relative to their long-term growth potential and to
larger-cap peers.
Following a strong run, a period of consolidation among these companies would
not be unusual and may in fact prove healthy in the long run. As these
businesses continue to deliver operational progress through clinical
milestones, regulatory decisions and commercial execution, we believe the
conditions remain in place for renewed share price strength.
Outlook
The investment case for biotechnology remains rooted in powerful structural
trends. Ageing populations, rising chronic disease burdens and the growing
need to improve healthcare efficiency are placing a growing strain on public
finances. Against this backdrop, innovation is not optional - it is essential.
Advances in areas such as gene therapy, rare diseases, oncology and metabolic
disease, which are all well represented within the Company's portfolio, have
the potential to transform patient outcomes while also improving the long-term
economics of healthcare.
In the shorter term, financial market sentiment will always ebb and flow. We
are reporting on a productive period, but it would be wrong to expect every
six months to deliver such exceptional returns. Risks have clearly risen in
recent months, with the conflict in Iran a potential source of ongoing
volatility, but whatever goes on in the world, people still require medicines
and Governments still prioritise healthcare. Meanwhile, we are approaching the
US mid-term elections, which could introduce renewed uncertainty. Healthcare
often attracts political scrutiny during US elections, but the extent to which
it has been under the policy spotlight over the last 12-18 months gives us
hope that the debate will be focused elsewhere this time round.
Despite the near-term risks, we remain confident about the long-term
opportunity set. This is a sector in which clinical and operational progress
ultimately drives value creation. Many investors still view biotech as a
sector with binary outcomes. This reflects the way in which the results of
clinical trials have sealed the fate of businesses on both sides of the
Atlantic. Many companies have succeeded with shareholders benefiting
enormously - but others have not.
We would argue that this perception of binary risk, albeit still valid in
development stage companies, is increasingly out of step with the opportunity
for the maturing sector that we see today. Many of the companies within our
portfolio are now approaching commercialisation, with the higher-risk phases
of development increasingly behind them.
We see a new opportunity to benefit from risk adjusted returns. Companies may
be acquired by larger pharmaceutical groups, crystallising value in the near
term, or they may go it alone and capture a much greater share of the economic
opportunity over time. The former can deliver immediate upside, but the latter
offers the potential for more substantial long-term returns, albeit with
higher execution risk. In both cases, shareholders stand to benefit.
Against this backdrop, we are excited by the shape of the portfolio and what
the businesses we own can achieve in the years ahead. The portfolio is
deliberately positioned towards high-quality, increasingly de-risked assets,
many of which are approaching - or, indeed, have already successfully passed -
key inflection points. These are precisely the types of businesses that are
attracting strategic interest from larger pharmaceutical companies, while also
being well-placed to succeed independently.
The biotechnology opportunity should never be viewed as risk-free. There are
always macro and micro risks to consider, and periods of volatility are
inevitable. However, in a sector where long-term outcomes are ultimately
driven by scientific progress and commercial execution, we believe the
portfolio is extremely well-positioned to capture the growth opportunity that
lies ahead.
Any reference to sectors/countries/stocks/securities are for illustrative
purposes only and not a recommendation to buy or sell any financial
instrument/securities or adopt any investment strategy. Past performance is
not a guide to future performance and may not be repeated. The value of
investments and the income from them may go down as well as up and investors
may not get back the amounts originally invested. Exchange rate changes may
cause the value of investments to fall as well as rise.
Ailsa Craig and Marek Poszepczynski
Portfolio Managers
Schroder Investment Management Limited
11 May 2026
Interim Management Statement
Principal risks and uncertainties
The principal risks associated with the Company's business fall into the
following risk categories: strategic; performance/investment; and operational.
A detailed explanation of the risks in each of these categories can be found
on pages 38 to 41 and in note 19 on pages 88 to 96 of the Company's published
Annual Report and Financial Statements for the financial year ended 31 August
2025.
In the view of the Board, the Company's principal risks and uncertainties have
not changed during the six months ended 28 February 2026. However, the Board
noted while reviewing these financial statements, that post the period end,
geopolitical risk has clearly increased. The outbreak of war in the Middle
East and the subsequent increase in energy prices and global expectations for
inflation and slower growth will have an impact on the portfolio and investor
confidence. The Board will continue to monitor these impacts, and report on
these in the next Annual Report.
Going concern
Having assessed the principal and emerging risks and uncertainties, and the
other matters discussed in connection with the viability statement as set out
on page 42 of the published Annual Report and Financial Statements for the
year ended 31 August 2025, the Directors consider it appropriate to adopt the
going concern basis in preparing the financial statements.
Related party transactions
There have been no transactions with related parties that have materially
affected the financial position or the performance of the Company during the
six months ended 28 February 2026.
Please refer to note 10 for further information on related party transactions
during the six months ended 28 February 2026.
Directors' responsibility statement
The Directors confirm that, to the best of their knowledge:
· the condensed set of financial statements contained within the
Half Year Report has been prepared in accordance with International Accounting
Standard 34, Interim Financial Reporting; and
· the Interim Management Report, together with the Chair's
Statement and Portfolio Managers' Review includes a fair review of the
information required by Disclosure Guidance and Transparency Rules 4.2.7R and
4.2.8R.
The Half Year Report has not been reviewed or audited by the Company's
auditors.
The Half Year Report for the six months ended 28 February 2026 was approved by
the Board on 11 May 2026 and the above responsibility statement was signed on
its behalf by the Chair.
Kate Cornish-Bowden
Chair
11 May 2026
Statement of Comprehensive Income
For the six months ended 28 February 2026 (unaudited)
(Unaudited) (Audited) (Unaudited)
For the six months
For the year
For the six months
ended 28 February 2026
ended 31 August 2025 ended 28 February 2025
Note Revenue Capital Total Revenue Capital Total Revenue Capital Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
Gains on investments held at fair value through profit or loss - 87,639 87,639 - 4,735 4,735 - 12,404 12,404
Net foreign currency gains/(losses) - 806 806 - 819 819 - (1,457) (1,457)
Income from investments 6 - 6 286 - 286 198 - 198
Other interest receivable and similar income 237 - 237 228 - 228 93 - 93
Gross return 243 88,445 88,688 514 5,554 6,068 291 10,947 11,238
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Investment management fee (1,022) - (1,022) (1,638) - (1,638) (885) - (885)
Performance fee - (1,452) (1,452) - (2,665) (2,665) - (1,885) (1,885)
Administrative expenses (305) - (305) (967) - (967) (499) - (499)
Net return/(loss) before finance costs and taxation (1,084) 86,993 85,909 (2,091) 2,889 798 (1,093) 9,062 7,969
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Finance costs (475) - (475) (1,940) - (1,940) (917) - (917)
Net return/(loss) before taxation (1,559) 86,993 85,434 (4,031) 2,889 (1,142) (2,010) 9,062 7,052
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Taxation (1) - (1) (28) - (28) (18) - (18)
Net return/(loss) after taxation (1,560) 86,993 85,433 (4,059) 2,889 (1,170) (2,028) 9,062 7,034
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Return/(loss) per share (pence) 4 (4.83) 269.25 264.42 (11.42) 8.13 (3.29) (5.60) 25.00 19.40
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
The "Total" column of this statement is the profit and loss account of the
Company. The "Revenue" and "Capital" columns represent supplementary
information prepared under guidance issued by The Association of Investment
Companies. The Company has no other items of other comprehensive income and
therefore the net return after taxation is also the total comprehensive income
for the period.
All revenue and capital items in the above statement derive from continuing
operations.
The notes form part of these financial statements.
Statement of Changes in Equity
For the six months ended 28 February 2026 (unaudited)
Note Called-up Share premium Capital redemption reserve Capital Revenue reserve Total
Share
£'000
£'000
reserves
£'000
£'000
capital
£'000
£'000
At 31 August 2025 10,346 29,873 31,482 235,794 (58,086) 249,409
Repurchase of the Company's own shares into treasury - - - (14,461) - (14,461)
Project cost - - - (30) - (30)
Net return/(loss) after taxation - - - 86,993 (1,560) 85,433
Dividend paid in the period 5 - - - (4,990) - (4,990)
---------- ---------- ---------- ---------- ---------- ----------
At 28 February 2026 10,346 29,873 31,482 303,306 (59,646) 315,361
====== ====== ====== ====== ====== ======
For the year ended 31 August 2025 (audited)
Note Called-up Share premium Capital redemption reserve Capital Revenue reserve Total
Share
£'000
£'000
reserves
£'000
£'000
capital
£'000
£'000
At 31 August 2024 10,346 29,873 31,482 264,591 (54,027) 282,265
Repurchase of the Company's own shares into treasury - - - (20,490) - (20,490)
Net return/(loss) after taxation - - - 2,889 (4,059) (1,170)
Dividend paid in the year 5 - - - (11,196) - (11,196)
---------- ---------- ---------- ---------- ---------- ----------
At 31 August 2025 10,346 29,873 31,482 235,794 (58,086) 249,409
====== ====== ====== ====== ====== ======
For the six months ended 28 February 2025 (unaudited)
Note Called-up Share premium Capital redemption reserve Capital Revenue reserve Total
Share
£'000
£'000
reserves
£'000
£'000
capital
£'000
£'000
At 31 August 2024 10,346 29,873 31,482 264,591 (54,027) 282,265
Repurchase of the Company's own shares into treasury - - - (9,089) - (9,089)
Net return/(loss) after taxation - - - 9,062 (2,028) 7,034
Dividend paid in the period 5 - - - (5,626) - (5,626)
---------- ---------- ---------- ---------- ---------- ----------
At 28 February 2025 10,346 29,873 31,482 258,938 (56,055) 274,584
====== ====== ====== ====== ====== ======
The notes form an integral part of these financial statements.
Statement of Financial Position
As at 28 February 2026 (unaudited)
Note (Unaudited) (Audited) (Unaudited)
At
At 31 August
At
28 February
2025
28 February
2026
£'000
2025
£'000
£'000
Fixed assets
Investments at fair value through profit or loss 344,115 268,920 311,045
Current assets
Debtors 241 136 906
Cash and cash equivalents 2,968 14,980 4,247
-------------- -------------- --------------
3,209 15,116 5,153
======== ======== ========
Current liabilities
Creditors: amounts falling due within one year 6 (31,963) (34,627) (41,614)
-------------- -------------- --------------
Net current assets (28,754) (19,511) (36,461)
======== ======== ========
Total assets less current liabilities 315,361 249,409 274,584
======== ======== ========
Net assets 315,361 249,409 274,584
======== ======== ========
Capital and reserves
Called-up share capital 7 10,346 10,346 10,346
Share premium 29,873 29,873 29,873
Capital redemption reserve 31,482 31,482 31,482
Capital reserve 303,306 235,794 258,938
Revenue reserve (59,646) (58,086) (56,055)
-------------- -------------- --------------
Total equity shareholders' funds 315,361 249,409 274,584
======== ======== ========
Net asset value per share (pence) 8 988.50 739.48 772.52
======== ======== ========
The notes form an integral part of these financial statements.
International Biotechnology Trust plc
Registered in England and Wales as a public company limited by shares
Company registration number: 02892872
Cash Flow Statement
Note (Unaudited) (Audited) (Unaudited)
For the six months ended
For the year ended
For the six months ended
28 February
31 August
28 February
2026
2025
2025
£'000
£'000
£'000
Operating activities
Profit before finance costs and taxation 85,909 798 7,969
Adjustments for:
Net foreign currency gains (806) (819) 1,457
Gains on investments at fair value through profit or loss (87,639) (4,735) (12,404)
Net sales/(purchases) of investments at fair value through profit or loss 10,449 33,513 (254)
Dividend income (6) (286) (198)
Interest income (237) (228) (93)
(Increase)/decrease in receivables (119) 9 20
(Decrease)/increase in payables (815) 1,766 1,189
Overseas taxation paid (1) (26) (18)
-------------- -------------- --------------
Net cash inflow from operating activities before dividends and interest 6,735 29,992 (2,332)
======= ======= =======
Dividends received 20 336 172
Interest received 237 245 115
Interest paid (475) (1,940) (880)
-------------- -------------- --------------
Net cash inflow from operating activities 6,517 28,633 (2,925)
======= ======= =======
Financing activities
Bank loan drawdown 30,334 31,106 23,558
Bank loan repaid (29,456) (23,345) (12,236)
Project cost (30) - -
Repurchase of ordinary shares into treasury (14,461) (20,490) (9,089)
Dividends paid 5 (4,990) (11,196) (5,626)
-------------- -------------- --------------
Net cash outflow from financing activities (18,603) (23,925) (3,393)
======= ======= =======
(Decrease)/increase in cash and cash equivalents (12,086) 4,708 (6,318)
Cash and cash equivalents at the start of the year 14,980 10,433 10,433
Effect of foreign exchange rates on cash and cash equivalents 74 (161) 132
-------------- -------------- --------------
Cash and cash equivalents at the end of the period/year 2,968 14,980 4,247
======= ======= =======
The notes form an integral part of these financial statements.
Notes to the Financial Statements
1. Financial statements
The information contained within the financial statements in this Half Year
Report has not been audited or reviewed by the Company's independent auditors.
The figures and financial information for the year ended 31 August 2025 are
extracted from the latest published financial statements of the Company and do
not constitute statutory financial statements for that year. Those financial
statements have been delivered to the Registrar of Companies, and included the
report of the auditors which was unqualified and did not contain a statement
under either section 498(2) or 498(3) of the Companies Act 2006.
2. Accounting policies
Basis of accounting
The financial statements have been prepared in accordance with International
Accounting Standard 34 "Interim Financial Reporting" and the accounting
policies set out in the statutory financial statements of the Company for the
year ended 31 August 2025. Where presentational guidance set out in the
Statement of Recommended Practice (the "SORP") for investment trusts issued by
The Association of Investment Companies in July 2022, is consistent with the
requirements of International Financial Reporting Standards, the financial
statements have been prepared on a basis compliant with the recommendations of
the SORP.
All of the Company's operations are of a continuing nature.
The accounting policies applied to these financial statements are consistent
with those applied in the financial statements for the year ended 31 August
2025.
3. Taxation
The tax charge comprises irrecoverable overseas withholding tax.
4. Return/(loss) per share
(Unaudited) (Audited) (Unaudited)
For the six months ended 28 February
For the year ended
For the six months ended 28 February
2026
31 August
2025
2025
Revenue loss (£'000) (1,560) (4,059) (2,028)
Capital return (£'000) 86,993 2,889 9,062
-------------- -------------- --------------
Total return/(loss) (£'000) 85,433 (1,170) 7,034
======== ======== ========
Weighted average number of shares in issue during the period 32,309,921 35,541,347 36,243,354
Revenue loss per share (pence) (4.83) (11.42) (5.60)
Capital return per share (pence) 269.25 8.13 25.00
-------------- -------------- --------------
Total return/(loss) per share (pence) 264.42 (3.29) 19.40
======== ======== ========
5. Dividends paid
(Unaudited) (Audited) (Unaudited)
For the six months ended 28 February
For the year ended
For the six months ended 28 February
2026
31 August
2025
£'000
2025
£'000
£'000
First interim dividend paid of 15.64p (2025: 15.56p) 4,990 5,626 5,626
Second interim dividend paid of 16.17p - 5,570 -
-------------- -------------- --------------
Total dividends paid 4,990 11,196 5,626
======== ======== ========
6. Creditors: amounts falling due within one year
(Unaudited) (Audited) (Unaudited)
28 February
31 August
28 February
2026
2025
2025
£'000
£'000
£'000
Bank loan 29,752 29,607 35,738
Securities purchased awaiting settlement 69 2,063 3,456
Other creditors and accruals 2,142 2,957 2,420
-------------- -------------- --------------
31,963 34,627 41,614
======== ======== ========
7. Called-up share capital
(Unaudited) (Audited) (Unaudited)
For the six months ended 28 February
For the year ended
For the six months ended 28 February
2026
31 August
2025
£'000
2025
£'000
£'000
Ordinary shares of 25p each, allotted, called up and fully paid:
Ordinary shares in issue:
Opening balance of 33,727,491 (year ended 31 August 2025: 36,834,910 and 8,432 9,209 9,209
period ended 28 February 2025: 36,834,910) ordinary shares of 25p each
Repurchase of 1,824,657 (year ended 31 August 2025: 3,107,419 and period ended (456) (777) (323)
28 February 2025: 1,290,971) shares held in treasury
Closing balance of 31,902,834 (year ended 31 August 2025: 33,727,491 and 7,976 8,432 8,886
period ended
28 February 2025: 35,543,939) shares in issue, excluding shares held in
treasury
======== ======== ========
Shares held in treasury 9,480,983 (year ended 31 August 2025: 7,656,326 and 2,370 1,914 1,460
period ended 28 February 2025: 5,839,878)
Closing balance of 41,383,817 (year ended 31 August 2025: 41,383,817 and 10,346 10,346 10,346
period ended 28 February 2025: 41,383,817) shares in issue
======== ======== ========
8. Net asset value per share
(Unaudited) (Audited) (Unaudited)
At 28 February
At 31 August
At 28 February
2026
2025
2025
Net assets attributable to shareholders (£'000) 315,361 249,409 274,584
Shares in issue at the end of period/year 31,902,834 33,727,491 35,543,939
Net asset value per share (pence) 988.50 739.48 772.52
======== ======== ========
9. Financial instruments measured at fair value
The Company's portfolio of investments, comprising investments in companies
and any derivatives, are carried in the Statement of Financial Position at
fair value. Other financial instruments held by the Company may comprise
amounts due to or from brokers, dividends and interest receivable, accruals,
cash and drawings on the secured revolving credit facility. For these
instruments, the Statement of Financial Position amount is a reasonable
approximation of fair value. The recognition and measurement policies for
financial instruments measured at fair value have not changed from those set
out in the statutory financial statements of the Company for the year ended 31
August 2025.
The investments in the Company's portfolio are categorised into a hierarchy
comprising the following three levels:
Level 1 - valued using quoted prices in active markets.
Level 2 - valued by reference to valuation techniques using observable inputs
other than quoted market prices included within Level 1.
Level 3 - valued by reference to valuation techniques using inputs that are
not based on observable market data.
Categorisation within the hierarchy has been determined on the basis of the
lowest level input that is significant to the fair value measurement of the
relevant asset.
At 28 February 2026, the Company's investment portfolio was categorised as
follows:
28 February 2026 (Unaudited) Level 1 Level 2 Level 3 Total
£'000
£'000
£'000
£'000
Financial instruments held at fair value through profit or loss
Equity investments 319,035 - 25,080 344,115
------------------ ------------------ ------------------ ------------------
Total 319,035 - 25,080 344,115
========== ========== ========== ==========
31 August 2025 (Audited) Level 1 Level 2 Level 3 Total
£'000
£'000
£'000
£'000
Financial instruments held at fair value through profit or loss
Equity investments 247,853 - 21,067 268,920
------------------ ------------------ ------------------ ------------------
Total 247,853 - 21,067 268,920
========== ========== ========== ==========
28 February 2025 (Unaudited) Level 1 Level 2 Level 3 Total
£'000
£'000
£'000
£'000
Financial instruments held at fair value through profit or loss
Equity investments 287,412 - 23,633 311,045
------------------ ------------------ ------------------ ------------------
Total 287,412 - 23,633 311,045
========== ========== ========== ==========
There have been no transfers between Levels 1, 2 or 3 during the period (year
ended 31 August 2025 and period ended 28 February 2025: nil).
10. Related party transactions
There have been no related party transactions that have materially affected
the financial position or the performance of the Company during the six month
period ended to 28 February 2026.
a) Transactions with the AIFM/Investment Manager
Until 1 September 2025, under the terms of the Alternative Investment Fund
Manager ("AIFM") agreement, the management fee payable to Schroder Unit Trusts
Limited ("SUTL"), by the Company on its quoted portfolio was 0.70% per annum.
Effective from 1 September 2025, the management fee was reduced to 0.65% per
annum.
Fees paid to the AIFM (Unaudited) (Audited) (Unaudited)
At 28 February
At 31 August
At 28 February
2026
2025
2025
£'000
£'000
£'000
Management fee paid by the Company directly to SUTL 979 1,638 885
Accounting and administration fee payable by the Company directly to SUTL 50 100 50
-------------- -------------- --------------
Total 1,029 1,738 935
======== ======== ========
A performance fee of £1,452,000 accrued for the six month period ended 28
February 2026 (31 August 2025: £2,665,000; 28 February 2025: £1,885,000). Of
the £1,452,000 accrued, £1,406,000 was outstanding to SUTL.
Under the terms of the AIFM agreement, SUTL is entitled to receive an annual
fee of £100,000 in respect of the accounting and administration services it
provides to the Company. As at the six month period ended 28 February 2026,
£16,000 (31 August 2025: £8,000; 28 February 2025: £17,000) was outstanding
to SUTL.
b) Directors' remuneration
The Directors of the Company are key management personnel. The total
remuneration payable to Directors in respect of the six months ended 28
February 2026 was £74,000 (31 August 2025: £183,500; 28 February 2025:
£92,000), of which £20,000 (31 August 2025: £29,000; 28 February 2025:
£31,000), was outstanding at the period end.
c) Other related party transactions
On 30 September 2025, the Company entered into an agreement with Schroders
Capital Management (Jersey) Limited (a related party to the Company) to
establish a partnership (the "Partnership") through which the Company intends
over time to invest in further unquoted biotechnology opportunities. Schroders
Capital Management (Switzerland) AG has been appointed as the investment
manager to the Partnership and the Company will be its sole limited partner.
Under the Partnership agreement, Schroders Capital is entitled to a management
fee of 0.90% per annum based on the asset value of the Company's investment in
the Partnership, with a minimum of £60,000 payable per annum for the first
three years, as well as £25,000 per annum for administration costs, with
aggregate fees due to Schroders Capital in any one year being capped at 0.25%
of the Company's net asset value. The amounts paid to Schroders Capital
through the Partnership, SC IBT SLP, for the six months ended 28 February 2026
were £30,000 for the management fee and £12,500 for the administration fee.
SV Health Managers LLP will continue to provide ongoing investment management
assistance to the Company in respect of the exited investments with contingent
milestones, the exited investments in liquidation and the directly held
unquoted investments in consideration for payment of a performance fee. An
accrued performance fee of £46,000 was outstanding to SV Health for the six
months ended 28 February 2026. Fees of £304,000 were paid to SV Health
through the Company's investments in venture capital funds during the six
months ended 28 February 2026.
11. Events after the reporting period
The Directors have evaluated the period since the half year date and have not
noted any significant events requiring disclosure after the end of the
reporting period to the date of this Half Year Report.
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