A surge in biotech M&A activity drove sharp gains across holdings in the ALPS Medical Breakthroughs ETF (SBIO ) during March, with two of the fund’s holdings becoming acquisition targets in deals worth a combined $8.1 billion. SBIO gained 8.4% over the past month and rose 9.4% over the past three months.
Key Takeaways
- Day One and Apellis became $8.1 billion acquisition targets, surging 102% and 92% respectively.
- SBIO gained 8.4% over the past month as biotech M&A activity accelerated.
- March biotech deals jumped 32% to 22 transactions worth $36 billion.
SBIO targets companies with drugs in Phase II or Phase III clinical trials, making the fund’s holdings natural acquisition candidates as large pharmaceutical groups seek to replenish pipelines. Biopharma companies announced 22 acquisitions worth approximately $36 billion during March alone, a 32% jump in deal volume compared to the previous quarter, according to Citeline reporting.
See more: This Biotech ETF Is a Catalyst-Rich Story
French pharmaceutical company Servier announced plans on March 6 to acquire Day One Biopharmaceuticals (DAWN) for $2.5 billion, to gain ownership of Ojemda, a pediatric cancer treatment the FDA approved in 2024. Servier offered $21.50 per share in cash, an 86% premium to Day One’s one-month average price.
Day One posted a 102.26% return in March and held a 1.47% weighting in SBIO’s portfolio as of March 27, according to VettaFi. The acquisition gives Servier a foothold in rare oncology, specifically pediatric low-grade glioma, a brain cancer affecting children.
Biotech Acquisitions Drive SBIO Stock Gains
Three weeks later, Biogen Inc. (BIIB) announced it would acquire Apellis Pharmaceuticals (APLS) for $5.6 billion to add two approved immunology drugs to its portfolio, according to a joint press release from the companies. The March 31 deal valued the company at $41 per share, a 35% premium to its 52-week high.
Biogen gains two approved drugs from the deal: EMPAVELI, which treats rare kidney diseases, and SYFOVRE, which treats a progressive eye disease that leads to blindness. Apellis surged 91.94% in March and represented 1.44% of SBIO’s holdings, according to VettaFi.
Beyond the acquisition wave, companies advancing drugs through clinical trials also posted gains. Dianthus Therapeutics (DNTH), which is developing treatments for autoimmune diseases affecting the kidneys and nervous system, rose 52.06% in March and held a 2.40% portfolio weighting, according to VettaFi. The company closed a $719 million public offering during the month to fund its pipeline, according to a press release.
The first quarter’s acquisition activity marked a return to deal volumes not seen since early 2024. The quarter produced 41 M&A transactions valued at $54.88 billion, with March accounting for roughly two-thirds of that total, according to Citeline.
SBIO holds 87 companies focused on breakthrough medical treatments. The fund concentrates 32.72% in rare and orphan diseases and 29.67% in dermatology, respiratory, eye, ear and neurology treatments, according to the fund’s factsheet as of December 31. The fund returned 113.64% over the past year, according to ETF Database.
Top 10 SBIO Holdings by March Performance
| Ticker | Company | March Return | Index Weight |
|---|---|---|---|
| DAWN | Day One Biopharmaceuticals | 102.26% | 1.37% |
| APLS | Apellis Pharmaceuticals | 91.94% | 3.17% |
| DNTH | Dianthus Therapeutics | 52.06% | 2.30% |
| ORKA | Oruka Therapeutics | 42.55% | 1.46% |
| XENE | Xenon Pharmaceuticals | 34.51% | 2.98% |
| TECX | Tectonic Therapeutic | 31.81% | 0.36% |
| ACRS | Aclaris Therapeutics | 30.66% | 0.28% |
| SRPT | Sarepta Therapeutics | 29.83% | 1.41% |
| KALV | KalVista Pharmaceuticals | 23.65% | 0.63% |
| APGE | Apogee Therapeutics | 20.24% | 2.91% |
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VettaFi LLC (“VettaFi”) is the index provider for SBIO, for which it receives an index licensing fee. However, SBIO is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of SBIO.
