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BBBIOTECH

euro adhoc: BB Biotech AG
Annual Reports
Preliminary Annual Report as at December 31, 2002 (E)

Disclosure announcement transmitted by euro adhoc. The issuer is
responsible for the content of this announcement.
Promising prospects after a difficult year
The year 2002 was characterized by generally weak market conditions.
Indeed, global stock markets declined for a third year in a row and
most indices suffered significantly. BB BIOTECH was not exempted,
with the BB BIOTECH Net Asset Value (NAV) and share price decreasing
by 46.5% and 54.8% (in CHF), respectively. Of note, however, is that
the NAV declined less than all major biotech indices. The difference
between the BB BIOTECH share price and its underlying NAV (i.e.
discount), increased to 17% by the end of the year. Given the solid
structure of the BB BIOTECH balance sheet, its long-term track
record, the investment strategy and the quality of our portfolio
companies, we don’t think this discount is justified.
Amidst the global stock market weakness, some biotech products
yielded a strong performance, further validating the business plan of
many biotech companies. These included Amgen’s Aranesp and Neulasta,
IDEC’s Rituxan and Actelion’s Tracleer. In addition, one of our core
holdings, IDEC Pharmaceuticals, received approval from the US Food
and Drug Administration (FDA) for its new drug Zevalin, which became
the world’s first radio-labeled therapeutic drug for the treatment of
refractory non-Hodgkin’s lymphoma (NHL). The FDA advisory committee
also recommended for approval MedImmune’s FluMist, which may become
the first approved nasal influenza vaccine in the USA, providing a
convenient alternative to the injectable products currently on the
market.
In 2002, we significantly increased our positions in Amgen due to the
anticipated strong performance of its key products. We also entered
into several new participations including Serono, due to the improved
prospects of its key product Rebif for treatment of multiple
sclerosis following an early FDA ruling; Shire Pharmaceuticals, based
on the strong performance of its key product Adderall XR for
treatment of Attention Deficit and Hyperactivity Disorder (ADHD);
Ligand Pharmaceuticals, due to the potential of Avinza for the
treatment of severe pain; and Enzon, due to its strong technology
platform based on pegylation of proteins. We sold our positions in
ImClone, Third Wave Technologies, Titan Pharmaceuticals and GenVec,
following a disappointing performance. Several of our portfolio
companies, including Neurocrine, EyeTech and Theravance, closed
significant collaborations with large pharmaceutical partners to
develop and market their drugs. These deals bode especially well for
our private equity investments EyeTech and Theravance and might help
to bring those companies public.
We are optimistic about the prospects for 2003 and expect new,
innovative products from our portfolio companies to enter and perform
well in the marketplace, such as MedImmune’s FluMist. Given the
long-term growth prospects of the companies in the biotech industry,
we value the current share prices in this sector as attractive, both
in terms of historical comparisons as well as in comparison with
other industries. If one puts the current Price/Earnings ratio into
context with the growth rate of earnings (PEG-ratio), biotech
companies are actually cheaper than most companies of other
industries. We expect M&A activities to continue at these valuations
throughout the entire healthcare sector; consolidations should lead
to more diversified, stable and product-oriented companies.
This is the composition of BB BIOTECHs’ Portfolio as at December 31,
2002:
CORE HOLDINGS  
Amgen                                                    27.9%
IDEC Pharmaceuticals                                     16.3%
MedImmune                                                12.8%
SMALL PARTICIPATIONS
Serono                                                    5.8%
Actelion                                                  4.0%
The Medicines Company (TMC)                               3.7%
Neurocrine Biosciences                                    2.7%
CV Therapeutics                                           2.7%
Adolor                                                    1.7%
Shire Pharmaceuticals                                     1.6%
Ligand Pharmaceuticals                                    1.1%
Pozen                                                     1.1%
Cubist Pharmaceuticals                                    0.7%
3-Dimensional Pharmaceuticals                             0.7%
Enzon Pharmaceuticals                                     0.7%
Endo Pharmaceuticals                                      0.7%
Virologic                                                 0.6%
Cell Therapeutics                                         0.5%
Transkaryotic Therapies                                   0.5%
Durect                                                    0.4%
Regeneron Pharmaceuticals                                 0.3%
Theravance (vormals Advanced Medicine) 1)                 2.0%
EyeTech Pharmaceuticals 1)                                1.6%
Liquid funds                                              9.3%
Total securities and Liquid funds:	 CHF 1 769.9 mn
1) unlisted company
The preliminary annual report is available on www.bbbiotech.com. The
full annual report will be published mid of March.
end of announcement        euro adhoc 30.01.2003

Further inquiry note:

Bellevue Asset Management, Grafenauweg 4, 6301-Zug, Switzerland Dr. Christian Lach or Edwin
van der Geest, Tel. +41 41 724 59 59

Branche: Biotechnology
ISIN: CH0001441580
WKN: 888509
Index: Investment Index (IGSP), Nemax All Share
Börsen: Frankfurter Wertpapierbörse / Neuer Markt
SWX Swiss Exchange / official dealing