Tareno Healthcare Funds monthly report April 2026

Market review

In April, the healthcare sector posted a return of -0.2%, driven by the reporting season and (geo)political developments. Over 40% of companies have already published Q1 figures, with 72% beating sales expectations and 83% beating earnings expectations – with higher surprises than in Q4. The Middle East was particularly relevant for MedTech and Life Sciences Tools & Services, with limited direct exposure overall. At the same time, risks such as higher freight costs, inflation and weaker demand were emphasized. M&A activity remained robust, led by Sun Pharma (USD 11.8 bn Organon), Eli Lilly (USD 9.3 bn incl. Kelonia and Ajax) and Gilead (USD 5 bn Tubulis). Other significant deals included Neurocrine/Soleno, Chiesi/KalVista, the take-private of Avanos, the sale of the Microbiology business by Thermo Fisher and Teva’s acquisition of Emalex.

Providers & Services (+14.4%) was driven by managed care companies. A key catalyst was the CMS announcement of the final Medicare Advantage rates for CY2027, which were well above expectations and triggered a strong rally. The performance was supported by solid quarterly figures with favorable medical loss ratios and improved pricing dynamics. Hospitals, on the other hand, remained under pressure as a weaker flu season weighed on volume development.

Large-cap Pharma (-1.2%) showed a mixed performance, driven by results and momentum in the obesity market. Eli Lilly initially underperformed due to discussions around the oral GLP-1 drug Foundayo, which was approved on April 1. FDA requirements and early, subdued prescription data led to uncertainty regarding launch, adherence and market share. However, after strong Q1 figures on April 30, driven by Mounjaro/Zepbound and a positive outlook for Foundayo, the share price recovered significantly. Novo Nordisk was the best performing pharma stock in April with +20%, supported by the successful launch of oral Wegovy and increasing confidence in the market launch.

Life Sciences Tools & Services (-1.9%) were under pressure at the beginning of the month following a proposed 2027 NIH budget with potential cuts and increased uncertainty in research funding. Diagnostics also suffered from CMS (“waste and fraud”) concerns, while AI announcements from OpenAI, Amazon and Anthropic’s acquisition of Coefficient Bio weighed on the sector as investors reassessed the long-term impact on the tools ecosystem.

Later in the month, Danaher, Thermo Fisher and Sartorius reported results in line with expectations, supported by solid biopharma demand, strong consumables and improving trends in China. All three confirmed their growth outlook, with guidance now appearing realistic rather than conservative, limiting upside potential. A weaker than expected flu season also weighed on the volume trend for diagnostic tests.

Biotech (-2.6%) saw SMID caps outperform large caps, supported by increased M&A speculation. Positive clinical data, particularly breakthroughs in pancreatic cancer (Revolution Medicines +48%), led to renewed investor interest. Regulatory and political topics were also in focus: the nomination of Erica Schwartz as CDC director was well received, while psychedelics stocks rose following a US executive order to promote appropriate therapies for mental illness. In addition, IPO activity was at its highest level for over five years at around USD 1.5 bn. Kailera set a record Nasdaq Healthcare IPO with USD 626m, followed by Henmab, Avalyn and Seaport.

MedTech (-4.6%) was weighed down by large caps. Bellwether stocks such as Boston Scientific and Intuitive delivered solid results and gained on the reporting day, but gave up the gains over the course of the month. Abbott and Stryker showed mixed results. Imaging providers fell after GE Healthcare reported inflationary pressures (oil, memory chips, freight). Dentals were a bright spot in April.

Outlook

Volatility is likely to persist as political developments, geopolitical risks and AI-driven structural changes continue to shape market sentiment. However, the sector’s fundamentals remain intact, supported by robust M&A activity, continued innovation and solid structural demand drivers for the medium to long-term growth outlook.

Review Tareno Sustainable Healthcare Fund

We did not add any new positions or close any existing ones last month. In April, the fund achieved a return of 0.7%, while the benchmark index lost 0.2%. The biggest positive attribution drivers compared to the index were:

• Centene (+67 bps): Solid Q1 figures and overall managed care strength
• UnitedHealth (+34 bps): Solid Q1 numbers and overall managed care strength
• Novo Nordisk (+30 bps): Solid momentum in oral Wegovy and AI partnership with OpenAI; additional share price gains after positive obesity market outlook from Lilly

The biggest negative attribution drivers compared to the index were:

• Elevance (-25 bp): not invested
• CVS (-21 bp): not invested
• Merck & Co (-18 bp): Share price decline after publication of abstract titles (including competitive programs in the PD-1/L1xVEGF Bispecific area) ahead of ASCO 2026. Subsequent recovery after strong Q1 figures.

Review Tareno Impact Healthcare Fund

Last month, we built up positions in Bavarian Nordic and Ypsodmed and sold Inspire, Hologic and Penumbra. In March, the Tareno Impact Healthcare Fund generated a return of 5.4%. The biggest positive contributions were:

• Centene (+ 180 bps): Solid Q1 numbers and overall managed care strength
• Humana (+120 bps): Solid Q1 numbers and overall managed care strength
• Axsome (+75 bps): FDA approval of AUVELITY for the treatment of agitation in Alzheimer’s dementia

The biggest negative contributions were:

• BioMerieux (-63 bp): Missed expectations and lowered 2026 guidance, weighed down by a mild flu season and a challenging geopolitical and macro environment
• Abbott (-36 bp): Mixed Q1 results and downgrade by a broker.
• Gilead (- 22 bp): Share price decline due to increasing competitive concerns in the in vivo CAR-T space following the Kelonia acquisition by Eli Lilly.