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After the volatile first quarter  BB MEDTECH shares outperformed  the
broader market  in  the second  quarter,  gaining +10.5%  (incl.  the
dividend of CHF  0.80) while  the Swiss Market  Index (SMI)  declined
-3.7%, the German benchmark index (DAX) -1.8% and the TecDax -1.1%.
The first half of 2008 was  generally marked by continued turmoil  on
financial markets worldwide. During  the first half  the value of  BB
MEDTECH shares retreated by -25.4% (incl. the dividend) to CHF 54.75.
The SMI had a negative performance of -18.0%, the DAX -20.4% and  the
TecDax -20.9%.  Net Asset  Value  per BB  MEDTECH share  declined  by
-22.6% to  CHF 59.67  during  the first  half. The  company's  equity
(excl. treasury shares) amounted to CHF 726 mn as of June 30, 2008.

The trend reversal in the second quarter was supported by most of our
holdings, especially Qiagen, Tecan  and Fresenius. Nobel Biocare,  on
the other hand, a holding  we had reduced significantly in  preceding
quarters, continued to retreat during  the second quarter. The  stock
market had been expecting a quicker turnaround of the company and was
disappointed once  again when  management  lowered its  guidance  for
fiscal 2008.

We continue to  implement our  strategy of  broadening the  portfolio
with the ultimate aim of having long term participations in 10 to  15
attractive medical  technology  companies. Further  adjustments  were
made to the portfolio in  the second quarter of  2008 as we built  up
positions in fast growing companies active in the fields of molecular
diagnostics, patient monitoring  and ophthalmology.  Our holdings  in
Celera and Epigenomics were  increased in the  second quarter (to  3%
and 1%  of equity  as  per June  30). Masimo  (2%)  was back  in  the
portfolio in the  second quarter  after its shares  corrected and  we
built-up a  new  position  in Optos  (<1%).  Our  long-standing  core
holding in Nobel Biocare  was reduced to 7%  of equity in the  second
quarter (36% as  of December 31,  2007). Our position  in Sonova  was
reduced to 13%, while the weightings  of our core holdings in  Qiagen
(23%), Tecan (14%) and Fresenius  (13%) changed only slightly, if  at
all. Galenica was reduced to 4% of equity, Millipore to 1%.

As of June 30, 82% of BB MEDTECH's assets were invested, a reflection
of both the  ongoing reallocation  process and  the uncertain  market
environment. We are confident the  available liquidity will allow  us
to successfully realign  the portfolio over  the coming months  while
taking advantage  of  the  opportunities  the  current  stock  market
weakness offers.

Qiagen  remains   our   largest  participation.   Digene   has   been
successfully  integrated  and  the  company  is  poised  to   further
strengthen its market  leadership in DNA/RNA  sample preparation  and
molecular diagnostics.  The acquisition  of Corbett  fills the  final
missing  link  for  a  complete  workflow  offering.  In  May  Sonova
published a good  set of results  for the 2007/08  business year.  It
remains a fundamentally  good play in  the global hearing  instrument
market.  Tecan  and  Fresenius  have  also  developed  in  line  with
expectations.

The four companies that were added  to the portfolio, or in which  we
took on  more exposure,  are  young, fast  growing companies  with  a
convincing technology  base  and sound  management.  California-based
Masimo has  successfully  positioned  itself in  the  pulse  oximetry
business, a USD  1 bn  sub-segment of the  global patient  monitoring
market,  with  an  innovative  and  competitively  superior   product
portfolio. It has displayed impressive growth rates. Optos, a company
headquartered in Scotland  and listed on  the London Stock  Exchange,
develops and markets equipment used to examine the retina, the tissue
structures lining  the  back of  the  eye that  provide  vision.  The
technology developed by Optos is patent-protected and allows  retinal
exams to be  performed in seconds,  without the use  of dilating  eye
drops. The US  company Celera,  which was  spun off  from its  parent
corporation Applera on June 30, boasts one of the most  comprehensive
pipelines for markers in cardiology and oncology. The German  company
Epigenomics, developing the Septin-9  blood test for early  detection
of colorectal cancer, is also active in the rapidly expanding  market
of molecular diagnostic testing.

We remain convinced that the medical technology market, driven as  it
is  by   demographic   developments   and   other   factors,   offers
above-average returns over the long term. BB MEDTECH will continue to
focus  on  attractive  and  fast  growing  market  segments  such  as
molecular diagnostics and  selectively invest in  the most  promising
companies in each  segment. Our  extensive industry  network and  the
expertise of the Board of Directors  and the management team are  key
elements of our investment strategy.
Regular, close contact with  the management of  the companies in  our
portfolio as well as  of potential investment  candidates is also  an
important factor. We continue to target an excess return in the  long
term with our sector-specific investment strategy rooted in  thorough
and sound fundamental analysis, as is reflected in our track  record:
BB MEDTECH shares have  advanced +177% during  the period from  early
2000 to the end of June 2008 (incl. dividend payouts).




The composition of BB MEDTECH's portfolio as at June 30, 2008 is  the
following (in % of equity):


Qiagen                                                 22.8%
Tecan                                                  14.4%
Fresenius preferred shares                             10.1%
Fresenius common shares                                 3.3%
Sonova                                                 13.1%
Nobel Biocare                                           7.3%
Galenica                                                4.3%
Celera                                                  3.2%
Masimo                                                  1.6%
Millipore                                               0.7%
Epigenomics                                             0.7%
Optos                                                   0.3%
Vascular Innovation preferred shares1)                  0.6%

SWAP agreement on treasury shares                       0.1%
Put option Nobel Biocare (short)                      (0.4%)
Put option Nobel Biocare (short)                      (0.4%)

Total securities                        CHF 592.4 mn   82.3%

Liquid funds (net)                      CHF 203.7 mn   28.1%
Other assets                             CHF 12.0 mn    1.7%
Other payables                         CHF (82.5) mn (11.4%)

Total shareholder's equity              CHF 725.6 mn  100.0%
Own shares (in % of company)                           16.1%


1)       unlisted company

The quarterly report is available on www.bbmedtech.com


For further information please contact:
Bellevue Asset Management AG, Seestrasse 16, CH-8700 Kusnacht/Zurich
Anja Stubenrauch, phone +41 44 267 67 00


 
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BB MEDTECH AG
Vordergasse 3 Schaffhausen Switzerland

WKN: AONFN4; 
ISIN: CH0038390016; Index: IGSP;
Listed: Investment Companies in SWX Swiss Exchange;
http://hugin.info/130286/R/1239364/265414.pdf


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