Tareno Health­care Funds Monthly Report, July 2026

Market review

In July, the health­care sector rose 1.45%, outper­forming global equities by 0.93%. This perfor­mance continued to be supported by a rotation into the health­care sector as investors reduced their momentum-driven positions in the AI sector. In addition, various M&A activi­ties and the start of the Q2 earnings season provided a boost. So far, over 55% of compa­nies have reported earnings, with 80% beating revenue expec­ta­tions and 86% beating EPS expec­ta­tions. The magni­tude of the earnings surprises was above the average for the past eight quarters. Signi­fi­cant M&A activity remained a key theme throug­hout the month. Vertex announced the acqui­si­tion of Crine­tics for USD 10 billion. Eli Lilly entered the psyche­de­lics sector with a transac­tion, acqui­ring AtaiBeckley (USD 3.8 billion). Argenx agreed to acquire Forte Biosci­ences for USD 2.2 billion, while Samsung Biolo­gics made a USD 1.8 billion offer for PolyPep­tide. Tempus AI also approved the acqui­si­tion of the remai­ning stake in Perso­nalis (USD 1.5 billion), and Novartis announced an agree­ment to acquire Myricx Bio for USD 1.5 billion.

Life Sciences Tools & Services gained 8.04%, as Q2 results exceeded expec­ta­tions and under­lying trends point to a pickup in growth compared to Q1. Danaher, the first major company in the Tools sector, set a positive tone with robust perfor­mance in life science instru­ments and diagno­stics, reflec­ting improved demand from large pharmaceu­tical compa­nies and early signs of a recovery in the early-stage biotech sector. The US Academic & Govern­ment segment remained weak but showed a slight impro­ve­ment in Q2 due to low compa­ra­tives. Industrial & Applied continued to outper­form, driven by AI-driven semicon­ductor invest­ments. Despite these positive develo­p­ments, investor senti­ment weakened after Danaher fell short of expec­ta­tions in Biopro­ces­sing. Manage­ment attri­buted the short­fall to a delay of appro­xi­m­ately USD 100 million in resin orders from a few major custo­mers and empha­sized that this was a tempo­rary rather than a struc­tural demand issue. Subse­quent results from Thermo Fisher and Repligen confirmed this assess­ment and unders­cored that funda­mental demand in biopro­ces­sing remains intact. At the same time, CROs posted a strong “beat-and-raise” quarter, driven by improved order intake and sustained high demand.

MedTech rose by 4.75%. While there were signs of a sector rotation, the momentum was parti­ally dampened by HCA’s pre-announce­ment. Over the course of earnings season, initial concerns about a decline in volumes—first raised by HCA and later by Intui­tive Surgical—have subsided. The weakness is incre­a­singly being attri­buted to changes in or losses of insurance coverage rather than to a decline in patient demand. Demand for urgent and medically neces­sary proce­dures remains strong, while only elective proce­dures are showing a moderate slowdown. Hospital invest­ments also remain robust overall.

Provi­ders & Services rose 1.97%, led by distri­bu­tors, which continued the strong momentum from June. Health­care Services (+4.1%) also performed well, with all compa­nies closing in positive terri­tory and U.S. labora­to­ries posting double-digit gains thanks to strong results. Hospital opera­tors posted positive returns despite ongoing headwinds from the insurance mix as ACA/HIX subsi­dies phased out. Managed Care (-1.6%) declined during the Q2 earnings season, with cost trends remai­ning a key focus for investors. The results revealed a diver­gence between compa­nies showing signs of cost norma­lization (Centene, United­He­alth) and those with persist­ently elevated loss ratios (Molina, Humana).

Biotech rose 0.76%. Second-quarter earnings were the main driver of the sector’s perfor­mance, although perfor­mance varied widely within the sector. It is worth noting that funding in the biotech sector remained strong, with over USD 9 billion in funding in June.

The pharmaceu­tical sector fell 0.44%. Key themes included Q2 earnings (which were largely solid), regula­tory milestones (inclu­ding the approval of the first oral PCSK9 inhibitor for high chole­sterol by Merck & Co.), setbacks in the pipelines of indivi­dual compa­nies (inclu­ding Astra­Ze­neca, Novo Nordisk, and Sanofi), incre­a­sing compe­ti­tion in the GLP‑1 sector between Eli Lilly and Novo Nordisk—including legal disputes—as well as poten­tial U.S. tariffs on generic drugs accor­ding to state­ments by the Trump admini­stra­tion (0% for the first two years, followed by 100% in the third year and 200% there­after).

Review Tareno Sustainable Health­care Fund

Last month, we did not estab­lish any new positions or close any existing ones. In July, the fund posted a return of 1.03%, while the bench­mark index rose 1.45%.

The biggest positive attri­bu­tion drivers compared to the index were:

• Dexcom ( +34 basis points): A “beat-and-raise” quarter
• Eli Lilly ( +20 bps): Stock price fell 4%; the stock is under­weight relative to the index
• Thermo Fisher ( +19 basis points): A quarter of beating expec­ta­tions and raising guidance

The biggest negative attri­bu­tion drivers in relation to the index were:

• Alnylam ( -29 basis points): Second-quarter results fell short of expec­ta­tions, and the outlook was lowered, prima­rily due to Amvuttra. Accor­ding to the company, the adjust­ment to the forecast reflects a norma­lization of second-line volume follo­wing the resolu­tion of previously pent-up demand.
• Astra­Ze­neca ( -22 bps): The mid-July decline in the stock price followed the Phase 3 setback for Wainua in transthy­retin-related amyloid cardio­myo­pathy (ATTR-CM) as well as a broker downgrade. Follo­wing solid Q2 results with better-than-expected EPS, the stock parti­ally recovered. Manage­ment confirmed its outlook and revenue target of USD 80 billion by 2030.
• Bristol-Myers ( -19 basis points): Not invested

Review Tareno Impact Health­care Fund

Last month, we did not estab­lish any new positions or close any existing ones. In July, the fund posted a return of 0.76%.

The biggest positive contri­bu­tions were:

• Tandem (+89 basis points): Tandem benefited from positive sector trends, driven by Abbott’s strong second-quarter results and the robust perfor­mance of FreeStyle Libre. Dexcom’s impres­sive results also confirmed the continued strong demand for CGM systems
• Dexcom ( +66 basis points): A “beat-and-raise” quarter
• Ambu (+63 basis points): Driven by a positive Q3 pre-close update, short covering, and continued share buybacks

The biggest negative contri­bu­tions were:

• Teladoc ( -50 bps): Share price decline follo­wing Q2 results and a downward revision of the full-year revenue forecast due to weakness in the Better­Help business
• Axsome ( -38 bps): No company-specific news
• Sandoz ( -33 basis points): Share price decline due to poten­tial U.S. tariffs on generic drugs; partial recovery follo­wing approval of a semaglutide treat­ment in Brazil