More health for the depot

So far, the funds of Apo Asset Management have been reserved in particular for medical professionals and pharmacists. But now other investors should also be able to invest.

Advances in medicine can create opportunities for investors

Dhe Apo Asset Management GmbH opens its range of funds to the general public. While exclusivity was previously agreed for the owners Apotheker- und Ärztebank (Apo Bank) and Deutsche Ärzteversicherung, which belongs to the Axa Group, the rules of procedure have now been changed. “Over the years we have built up a high level of expertise in investing in the health sector, from which all investors should now benefit,” says managing director Claus Sendelbach in an interview with this newspaper.

Düsseldorf-based Apo Asset launched its first health fund back in 2005, which has now reached a volume of a good 700 million euros. The management of Apo Medical Opportunities (WKN A0EQ6Y) is not only supported by the experts from Apo Asset, but also from Medical Strategy, an investment advisor from Graefelfing near Munich who specializes in health issues. “This means that we have the expertise of more than 20 analysts and fund managers in this area,” says Heiko Opfer, the second managing director of Apo Asset. “In contrast to other fund companies in which the health issue is just one of many, we offer a flawless focus and are therefore very attractive to the few experts in this area who have only felt themselves to be in a niche role elsewhere.”

Industry insiders work at Medical Strategy. “They are molecular biologists and other – you could almost say – nerds with a deep knowledge of new active ingredients and close to basic research,” says victim. In January, Apo Asset acquired a 25.1 percent stake in the owner-managed company. Expertise in the pharmaceutical and biotech sectors flows into the Opportunities Fund. Apo Asset takes care of the selection of medical technology companies from the areas of administration, insurance and process management.

Aging as a price driver

The fund is up 23 percent this year. That is less than, for example, the Dax with 27 percent. However, the fund has lower price fluctuations. The managing directors also refer to the long-term perspective. “The health sector benefits from megatrends such as the aging of society and the increase in prosperity in the emerging countries and is also largely independent of the economic cycle,” says Sendelbach. The United States currently spends 17 percent of its gross domestic product on health – a global record. In Germany and Japan it is 11 percent, in China 6, in India 5 and in Indonesia 3. Great growth potential is seen here.

Apo Asset has therefore just launched its own Apo Emerging Health equity fund (WKN A2PPZD), which invests in health stocks from emerging countries. The specialists at Swiss Bellevue Asset Management provide their expertise for China, India and the Far East. Apo Asset does the rest of the world itself. Nothing substantial can be said about the performance.

The third fund in the healthcare universe is Apo Digital Health (WKN A2AQYW), which has been focusing on digitization in healthcare for a good two years. From Germany, the Koblenz Compugroup is one of the larger stocks, but SAP and Siemens Healthineers are also in the fund. However, the focus is clearly on America, where tech giants such as Google, Apple and Amazon are also in the fund, because they will be putting an increasingly large part of their research investments in the health sector over the next five years and expect great market potential there. The fund got off to a brilliant start, this year it is 25 percent up, with a view to two years it is 40 percent.

The fourth fund builds entirely on the expertise of Medical Strategy in drug research. The Medical Biohealth (WKN 941135) invests long-term in companies that are hoped for groundbreaking inventions of new drugs and therapies. This year it is almost 40 percent up. In the past ten years there has been an average increase in value of 18 percent. Most of the stocks in the fund with a volume of more than 300 million euros are little known.

“We are not index cuddlers”

As in the other Apo Asset funds, great importance is attached to in-depth analysis of the companies and investments in this area are far removed from the leading indices. “Fund analysts like Morningstar don’t like that, but we are not boring index cuddlers, we offer investors carefully compiled products that are off the beaten track for their money,” says Opfer.

Apo Asset does not yet have the penetration power to play a major role in the active sales of banks and savings banks. It therefore primarily relies on self-determined investors who choose their funds on fund platforms, as well as on fee-based advisors. “We are now taking a first step outwards and hope that our expertise in the health sector will convince many investors and investment advisors,” says Sendelbach. “We have highly recognized consultants such as the long-time President of the Medical Association, Frank Ulrich Montgomery, and the chairman of the Advisory Council on the Assessment of Developments in the Health Care System, Ferdinand Gerlach, with excellent contacts in the industry.”