Kiwoom Asset Management Launches ETF Tracking Solactive Blockbuster Biotech Drugs Index
Solactive is proud to partner with South Korea’s Kiwoom Asset Management on the launch of the KIWOOM KOSEF US Blockbuster Biotech Drugs Plus ETF, which tracks the performance of the Solactive Blockbuster Biotech Drugs Index.
The biopharma sector has undergone disruptive growth, primarily driven by data-powered insights and increasingly sophisticated medical technology, leading to soaring investments and activities in areas such as early detection and curative therapies, with over US$8.9 billion investments in cell and gene therapies in 2019 and this number is ever-growing.[1] According to industry reports, the biopharmaceuticals industry is expected to experience an annual sales growth of 5.2% until 2028, where extensive research on various acute and even chronic diseases continues to accelerate the development of groundbreaking drugs and treatments, creating a compelling investment opportunity.[2]
The Solactive Blockbuster Biotech Drugs Index (SOLBBBD) aims to capture the performance of companies operating in the biotech industry, with focus on the so-called Blockbuster Drug companies. These companies have achieved annual biotechnology product revenues of more than $1 billion with at least one product. Additionally, an Expected Biotech Blockbuster Company will also be considered for index inclusion, with at least one product that is expected to generate revenues exceeding $1 billion over the 5-year period following the selection day. The index constituents are weighted according to the Biotech Blockbuster Drug revenues over a 5-year period, with an upper cap at 10%.
The ETF listed on 28 May 2024 on the Korea Stock Exchange (KRX) with the ticker code 483030.KS.
Timo Pfeiffer, Chief Markets Officer at Solactive, comments: “In a post-COVID world, the biotech sector is no longer reserved for niche experts but has captured the attention of the broader public. We believe that this index strategically enhances access to a vital industry like biopharmaceuticals that continues to shape the future of human health. On this note, we are very pleased to continue our partnership with Kiwoom and take great pride in launching the Solactive Blockbuster Biotech Drugs Index with our ongoing commitment to pioneering and forward-thinking endeavors in the indexing space.”
Seongin Jeong, Head of ETF Business Department at Kiwoom, comments: “We are very pleased to collaborate with Solactive, which has a strong track record in developing strategic indexes, to launch a new product that provides strategic exposure to the biotechnology industry, which is expected to grow in the future.
The presence of blockbuster drugs in a biotech company and the size of blockbuster drug sales are useful indicators of the size and sustainability of a company’s revenue.
KIWOOM KOSEF US Blockbuster Biotech Drugs Plus ETF, which invests in companies on a blockbuster drug revenue-weighted basis, will provide global investors with an effective way to invest in blue-chip biotech companies with proven innovation and profitability.”
[1]https://www2.deloitte.com/cn/en/pages/life-sciences-and-healthcare/articles/the-future-of-biopharma.html
[2]https://www.morningstar.com/lp/biopharma-landscape