Notes to the consolidated financial statements

1. The Company and its principal activity

BB Biotech AG (the Company) is listed on the SIX Swiss Exchange as well as in the «Prime Standard Segment» of the German Exchange and has its registered office in Schaffhausen, Schwertstrasse 6. Its principal activity is to invest in companies active in the biotechnology industry for the purpose of capital appreciation. The investments are held through its wholly owned subsidiaries.

2. Accounting policies

The condensed consolidated interim financial statements of the Company and its subsidiary companies (the Group) have been prepared in accordance with International Accounting Standards (IAS) 34 «Interim Financial Reporting,» as well as the provisions of the rules of the SIX Swiss Exchange for Investment Companies and should be read in conjunction with the consolidated annual financial statements for the year ended December 31, 2024. The preparation of the condensed consolidated interim financial statements requires management to make assumptions and estimates that have an impact on the balance sheet values and items of the statement of comprehensive income in the current financial period. In certain circumstances, the actual values may diverge from these estimates.

The condensed consolidated interim financial statements have been prepared in accordance with the accounting policies set out in the consolidated annual financial statements.

The following amended standard, valid since January 1, 2025, has been applied in these condensed consolidated interim financial statements:

• IAS 21 (amended, effective January 1, 2025) – Lack of Exchangeability

The following new and amended standards were approved, but will only be applicable for the Group prospectively and were not early adopted in these condensed consolidated interim financial statements:

• IFRS 9/IFRS 7 (amended, effective January 1, 2026) – Classification and Measurement of Financial Instruments
• IFRS 18 (effective January 1, 2027) – Presentation and Disclosure in Financial Statements
• IFRS 19 (effective January 1, 2027) – Subsidiaries without Public Accountability: Disclosures

The Group assessed the potential impact of the above-mentioned new and amended standards. Based on the analysis, the Group concludes that these new and amended standards have no material impact on the Group’s accounting policies and overall results and financial position.

The following exchange rates have been used for the preparation of these condensed consolidated interim financial statements:

3. Financial assets

Fair Values

The following table presents the Group’s assets that are measured at fair value (in CHF 1 000):

The table below summarizes the transactions in level 3 instruments (in CHF 1 000):

There were no transfers between level 1, 2 and 3 during the reporting period.

The fair value of level 3 instruments at initial recognition represents the transaction price (purchase of preferred stocks of Rivus Pharmaceuticals in August 2022 for TCHF 16 875, August 2024 for TCHF 15 139 and January 2025 for TCHF 12 079), which was paid in financing rounds together with other investors. For the valuation as at March 31, 2025, it is deemed to be appropriate to use the latest transaction price in USD, as it is a reasonable approximation of fair value at the valuation date given the fact that no events occurred which significantly impact the fair value.

In August 2022, 8 733 538 Radius Health – Contingent Value Rights were allocated from a corporate action. In February 2025 BB Biotech received USD 1 per Right.

For assets and liabilities carried at amortised cost, their carrying values are a reasonable approximation of fair value.

Securities

The changes in value of securities at fair value through profit or loss by investment category are as follows (in CHF 1 000):

Securities comprise the following:

4. Short-term borrowings from banks

At March 31, 2025, there is no short-term loan outstanding (December 31, 2024: CHF 117.5 mn at 0.90% p.a.).

5. Shareholders’ equity

The share capital of the Company consists of 55.4 mn fully paid registered shares (December 31, 2024: 55.4 mn) with a par value of CHF 0.20 each (December 31, 2024: CHF 0.20).

Treasury shares

The Company can buy and sell treasury shares in accordance with the Company’s articles of association and Swiss company law and in compliance with the listing rules of the SIX Swiss Exchange. During the period from January 1, 2025, to March 31, 2025, the Company has bought 70 750 treasury shares and has not sold any treasury shares (01.01.–31.03.2024: no transactions). As at March 31, 2025, the Company holds 708 750 treasury shares (December 31, 2024: 638 000 shares). The treasury shares as at March 31, 2025, were treated as a deduction from the consolidated shareholders’ equity using cost values of TCHF 42 058 (December 31, 2024: TCHF 39 640).

Share buyback 2^nd line (bought for cancellation)

The Board of Directors has approved the repurchase of a maximum of 5 540 000 own registered shares with a nominal value of CHF 0.20 each. Until the end of the program at April 11, 2025, 250 750 registered shares were repurchased via a second trading line for the purpose of capital reduction. Until March 31, 2025, 154 750 shares had been repurchased under this share buy-back program (December 31, 2024: 84 000 shares).

6. Administrative expenses

Administrative expenses comprise the following:

The remuneration model of BB Biotech AG is determined by the Board of Directors.

Since 2014 the remuneration paid to the investment manager is based upon a 1.1% p.a. all-in fee on the average market capitalization without any additional fixed or performance-based elements of compensation. The compensation of the Board of Directors consists since 2014 of a fixed compensation.

7. Segment reporting

The sole operating segment of the Group reflects the internal management structure and is evaluated on an overall basis. Revenue is derived by investing in a portfolio of companies active in the biotechnology industry for the purpose of capital appreciation. The following results correspond to the sole operating segment of investing in companies active in the biotechnology industry.

The geographical analysis of the profit/(loss) before tax is as follows – all income from financial assets are attributed to a country based on the domiciliation of the issuer of the instrument.

8. Earnings per share

9. Assets pledged

At March 31, 2025, securities in the amount of CHF 1 859.3 mn (December 31, 2024: CHF 2 406.9 mn) are collateral for a credit line of CHF 700 mn (December 31, 2024: CHF 700 mn). At March 31, 2025, there is no short-term loan outstanding (December 31, 2024: CHF 117.5 mn).

10. Transactions with the Investment Manager and related party transactions

Detailed information regarding the remuneration model for the Board of Directors and the investment manager are mentioned under note «6. Administrative Expenses».

11. Commitments, contingencies and other off-balance sheet transactions

The Group had no commitments or other off-balance sheet transactions open at March 31, 2025 and December 31, 2024.

The operations of the Group are affected by legislative, fiscal and regulatory developments for which provisions are made where deemed necessary. The Board of Directors concludes that as at March 31, 2025, no proceedings existed which could have any material effect on the financial position of the Group (December 31, 2024: none).

12. Subsequent events

There have been no events subsequent to March 31, 2025, which would affect the condensed consolidated interim financial statements.