Tareno Health­care Funds Monthly Report for August 2026

Market review

The health­care sector posted a return of 3.71% in August, conti­nuing the positive momentum from July. This marked the sector’s third conse­cu­tive month of outper­for­mance. This perfor­mance was supported by a major clinical catalyst, a strong overall Q2 earnings season, brisk M&A activity, and the ongoing rotation into the health­care sector. The most signi­fi­cant catalyst was positive Phase 3 data from Moderna and Merck regar­ding the treat­ment of melanoma, which triggered the stron­gest one-day gain in health­care stocks in 16 months. With the Q2 earnings season largely complete, the August results as a whole unders­cored the positive trends already observed in July. About 78% of compa­nies beat revenue expec­ta­tions and 88% beat EPS expec­ta­tions, with the magni­tude of earnings surprises excee­ding the average of the past eight quarters. M&A activity in the health­care sector remained at a high level in August. Lantheus is being acquired by Curium for USD 8.0 billion, followed by Integer’s acqui­si­tion by KKR for USD 5.7 billion. Eli Lilly is acqui­ring Merida for up to USD 2.9 billion, McKesson Precision Medicine for USD 2.25 billion. Other transac­tions included Jazz’s acqui­si­tion of Actio Biosci­ences for up to USD 1.3 billion and Varex for USD 1.1 billion. Supernus and Indivior also agreed to a merger through a stock swap.

Biotech­no­logy rose 9.38% in August, marking one of the stron­gest months in recent years. The sector was bolstered by major clinical milestones and positive Q2 earnings reports. The key catalyst was the success of Moderna and Merck in their Phase 3 trial for their perso­na­lized mRNA cancer vaccine for the treat­ment of melanoma on August 19. Moderna rose 177% that day, while the Nasdaq Biotech­no­logy Index rose as much as 5.9% at one point. Earlier in the month, Argenx saw a signi­fi­cant rise in its stock price follo­wing positive Phase 3 results for efgar­tig­imod in the treat­ment of immune-mediated necro­tizing myopathy. Prior to these clinical catalysts, the sub-sector was also supported by several positive market reactions to Q2 results, inclu­ding those from CSL, Amgen, and Genmab.

Life Sciences Tools & Services posted a return of 7.41% in August. The positive momentum from July, driven by a strong earnings season, continued throug­hout the month. The August results from index consti­tu­ents Waters and Agilent confirmed the strength already observed during the broader earnings season in July. The most important catalyst, however, was the positive Moderna-Merck study on the mRNA vaccine. Compa­nies with exposure to the mRNA proces­sing sector benefited signi­fi­cantly, parti­cu­larly biopro­ces­sing compa­nies. Investors reassessed the poten­tial for rising demand across the entire mRNA value chain.

MedTech rose 4.08% in August, conti­nuing the positive momentum from July. The environ­ment for the sector remained supportive, with most compa­nies excee­ding expec­ta­tions for organic revenue growth and several raising their revenue and/or profit forecasts. In the ortho­pe­dics segment, under­lying demand remained robust despite ongoing concerns regar­ding insurance coverage and reimbur­se­ment. Volumes and invest­ments proved to be more resilient than expected. Dental Care remained a challen­ging end-market segment, while Eye Care and Hearing Care continued to show signs of impro­ve­ment from Q1 to Q2.

Pharmaceu­ti­cals rose 2.34% in August. This was driven by a combi­na­tion of M&A specu­la­tion, earnings updates, clinical catalysts, and regula­tory develo­p­ments. The month began with a renewed focus on M&A after reports surfaced that Astra­Ze­neca and Bristol Myers Squibb had discussed a poten­tial merger. This would have created a company valued at around USD 400 billion and marked one of the largest mergers in the history of the pharmaceu­tical industry. The reports were subse­quently denied. Earnings remained a key driver of stock prices, with positive reactions to results from Eli Lilly, Pfizer, and Bayer. Novo Nordisk, on the other hand, came under pressure follo­wing disap­point­ments surroun­ding the rollout of the Wegovy pill. Clinical develo­p­ments were the most important catalyst over the course of the month, led by positive Phase 3 data on Moderna and Merck’s perso­na­lized mRNA cancer vaccine for melanoma. Merck subse­quently rose 12.6%. Last week, however, the pharmaceu­tical sector gave back a large portion of its interim gains as concerns over U.S. drug prices resur­faced. The Trump admini­stra­tion announced pricing agree­ments for Medicaid drugs with nine pharmaceu­tical and biotech compa­nies.

Provi­ders & Services posted a return of ‑1.78%. Drug Distri­bu­tors rose 2.8%, buoyed by solid Q2 results, while Facili­ties also gained 2.8%. Managed Care fell by 2.94%, weighed down by United­He­alth despite the absence of specific company news. Health­care Services dropped by 4.74%, as the continued solid perfor­mance of U.S. labora­tory service provi­ders was unable to offset the weakness at CVS and Frese­nius Medical Care.

Tareno Sustainable Health­care Fund Review

Last month, we estab­lished a new position in Caris and did not close any existing positions. In August, the fund generated a return of 3.97%, while the bench­mark index rose 3.71%.

The largest positive drivers of attri­bu­tion relative to the index were:

• Veeva ( +56 bp): Announce­ment of several major Vault CRM custo­mers, followed by a strong “beat-and-raise” quarter
• Vertex ( +32 bp): A “beat-and-raise” quarter. Additio­nally, Sionna Thera­peu­tics missed the primary endpoint with SION-719, thereby elimi­na­ting the compe­ti­tive risk for Vertex.
• CVS ( +23 bp): Not invested

The largest negative drivers of attri­bu­tion relative to the index were:

• Amgen ( -22 bp): Not invested
• CSL ( -20 bp): Not invested
• Pfizer ( -18 bp): Not invested

Tareno Impact Health­care Fund Review

Last month, we did not estab­lish any new positions and closed our position in ZaiLab. In August, the fund generated a return of 6.64%.

The largest positive contri­bu­tors were:

• Natera ( +69 bp): A quarter that beat expec­ta­tions and raised guidance, driven by record-high volumes
• RadNet ( +60 bp): A quarter that beat expec­ta­tions and raised guidance, driven by Advanced Imaging
• Tandem ( +54 bp): Quarter in line with expec­ta­tions. The PayGo subscrip­tion accounted for 10% of U.S. revenue in the first full quarter, while health insurance coverage, at 45%, was near the upper end of the annual target.

The largest negative contri­bu­tors were:

• Axsome ( -26 bp): Solid Q2, but the stock fell 8.9% over the course of the month without any company-specific news
• Teladoc ( -10 bp): No specific news; conti­nua­tion of the negative momentum from July
• Novo Nordisk ( -9 bp): Novo Nordisk reported mixed Q2 results. The better-than-expected overall perfor­mance was overs­ha­dowed by disap­poin­ting results related to the Wegovy pill. In addition, the REIMAGINE‑4 study showed that Cagri­Sema was non-inferior in terms of weight loss but inferior in terms of HbA1c reduc­tion.