THE BIOTECH GROWTH TRUST PLC Audited Results for the Year Ended 31 March 2015 NEWS RELEASE For immediate release 21 May 2015 To: City EditorsThe Biotech Growth Trust PLC today announces audited results for the year ended 31 March 2015 About The Biotech Growth Trust PLC The Biotech Growth Trust PLC seeks capital appreciation through investment in the worldwide biotechnology industry. In order to achieve its investment objective, the Company invests in a diversified portfolio of shares and related securities in biotechnology companies on a worldwide basis. Further details of the Company's investment policy are set out within the strategic report of this annual report. Keep up to date with The Biotech Growth Trust PLC For more information about The Biotech Growth Trust PLC visit the website at www.biotechgt.com Follow us on Twitter @biotechgt Winner: Money Observer Awards, best large Trust 2014 Investment Week, Investment Company of the year, Specialist Category 2012 and 2013 techMark Technology Fund Manager of the year 2011 and 2012 (OrbiMed Capital LLC) UKtech awards Fund Manager of the year 2013 (OrbiMed Capital LLC) Investment Trusts Magazine, Best Specialist Trust 2011 and 2012Company SummaryThe CompanyThe Company is an investment trust and itsshares are listed on the Official List andtraded on the main market of the London StockExchange. The Company is a member of theAssociation of Investment Companies ("AIC").Total assets less current liabilities as at31 March 2015 were £533.3 million and themarket capitalisation was £507.0 million.ManagementThe Company is an Alternative Investment Fund("AIF") under the European Union AlternativeInvestment Fund Managers' Directive("AIFMD"). During the year the Companyappointed Frostrow Capital LLP ("Frostrow")as Alternative Investment Fund Manager("AIFM") to provide company management,company secretarial, administrative andmarketing services. The Company and Frostrowjointly appointed OrbiMed Capital LLC("OrbiMed") as Portfolio Manager. Furtherdisclosures required under the AIFMD can befound on the Company's website:www.biotechgt.com.PerformancePerformance is measured against the NASDAQBiotechnology Index (sterling adjusted).Capital StructureThe Company's capital structure is composedsolely of Ordinary Shares. Details are givenin note 11 to the accounts.DividendNo dividend is recommended in respect of theyear ended 31 March 2015 (2014: nil).Continuation VoteIn accordance with Company's Articles ofAssociation a resolution will be proposed atthe forthcoming Annual General Meeting thatthe Company continue as an investment trustfor a further five year period.If passed the next continuation vote of theCompany shall be held at the Annual GeneralMeeting in 2020 and further opportunities tovote on the continuation of the Company shallbe given to shareholders every five yearsthereafter.ISA StatusThe Company's shares are eligible forIndividual Savings Accounts ('ISAs') and forJunior ISAs.Strategic Report / Company PerformanceFinancial Highlights As at As at 31 March 31 March % 2015 2014 ChangeNet asset value per share 834.7p 498.7p +67.4Share price 793.5p 467.0p +69.9Discount of share price to net asset value per share 4.9% 6.4% -NASDAQ Biotechnology Index(sterling adjusted) (Benchmark) 2,423.5 1,480.1 +63.7Ongoing charges* 1.2% 1.2% -Gearing* 9.4% 8.3% -* See glossary.Five Year Performance Record 2010 2011 2012 2013 2014 2015Net asset value per share 182.6p 186.0p 250.9p 371.7p 498.7p 834.7pShare price 175.8p 166.0p 236.0p 368.0p 467.0p 793.5pDiscount of share price to netasset value per share 3.7% 10.8% 5.9% 1.0% 6.4% 4.9%NASDAQ BiotechnologyIndex (sterling adjusted) 618.1 647.9 801.1 1,099.0 1,480.1 2,423.5Dear Shareholder,Investment performanceI am delighted to report that following last year's strong performance theCompany has again achieved excellent returns for shareholders. During the yearthe Company's net asset value per share increased by 67.4% which outperformedthe Company's benchmark index which increased by 63.7%.The Company's positive performance during the year was due in part to theperformance of holdings in Biogen, Gilead Sciences, Celgene, NeurocrineBiosciences and Medivation. Arrowhead Research, Prothena and VandaPharmaceuticals were poor performers during the year. Our experience with theseinvestments is, whilst disappointing, symptomatic of investing in thebiotechnolgy sector which can be volatile; inevitably there will be investmentswhich do not deliver positive returns for shareholders. Further information onthe Company's investments can be found in the Portfolio Manager's Review andPortfolio Focus.This is the tenth anniversary of your Company appointing OrbiMed as PortfolioManager, which has enabled the Company to continue strong overall performanceand has enabled it to win further awards. It is particularly pleasing to reportthat your Company was declared the best large trust at the 2014 Money ObserverAwards.Share price performanceThe Company's share price increased by 69.9% over the year as a whole. Duringthe earlier part of the year, the Company's continued strong overallperformance gave rise to new demand for the Company's shares and a total of110,000 shares were re-issued from treasury at a small premium to the net assetvalue per share reflecting the Board's proactive approach to discountmanagement. This share issuance, however, was offset by the need to buy back4,445,522 shares in the later part of the year reflecting the Board'scommitment to limit the Company's share price discount to 6% over thelong-term. Share buy-backs have continued since the year-end with a further701,783 shares having been bought back for holding in treasury up to the dateof this report. As at 31 March 2015 the Company had 68,886,347 shares in issueincluding 4,997,831 shares held in treasury (2014: 68,886,347 including 652,309shares held in treasury).Return and DividendThe total return per share amounted to 328.0p for the year (2014: 126.8p),comprising a revenue gain of 0.2p per share (2014: 0.1p revenue deficit) and acapital gain of 327.8p (2014: 126.9p). No dividend is recommended in respect ofthe year ended 31 March 2015 (2014: nil).Board CompositionAs announced this time last year, Dr. John Gordon retired from the Board at theconclusion of the 2014 Annual General Meeting. Under the guidance of theNomination Committee the composition of the Board is being refreshed in orderto ensure that it continues to be independent and complies with good corporategovernance practice and the AIC Investment Trust Guidelines.Mr. Paul Gaunt will retire at the conclusion of the forthcoming 2015 AnnualGeneral Meeting. Paul has served on the Board since the launch of the Companyin 1997. Paul has been an outstanding member of the Board and we haveparticularly valued his overall contribution and in particular when the Companychanged its Portfolio Manager during a time when the future of the Company wasin question. He will be greatly missed.It is my intention to retire as Chairman at the conclusion of the 2016 AnnualGeneral Meeting. I have been on the Board since 1998 and Chairman since 2012. Iam delighted that Mr. Andrew Joy is to succeed me as Chairman. His extensiveexperience in the investment community will undoubtedly serve shareholders wellin the future.The Board is currently in the process of recruiting a new director to the Boardas part of our ongoing refreshment programme. Accordingly the Board haveengaged the services of a specialist non-executive director recruitmentconsultant, Trust Associates, in order to facilitate this search and anannouncement will be made in due course.I can formally confirm that Trust Associates has no other connection with theCompany.Proposed Changes to the Company's Articles of AssociationIt is proposed that the Company adopts new Articles of Association (the"Articles") to enable it to comply with its obligations under variousinternational tax regulations. A Special Resolution will be proposed at theAnnual General Meeting which will, if approved ratify the adoption of amendedArticles of Association. The material differences between the current and theproposed Articles of Association are summarised within the explanatory notes tothe Notice of Meeting.BorrowingShareholder approval to increase the Company's borrowing limit from 15% to 20%was obtained at a General Meeting held on 31 March 2015. The intention behindincreasing the borrowing facility is not to take the borrowing levels to theirmaximum and keep them there over the long-term. Rather, the increased facilityprovides the Portfolio Manager with tactical flexibility for situations whenmarket dislocations exist. It enables the Portfolio Manager to move quickly totake advantage of opportunities to acquire quality companies at distressedprices, without necessarily having to sell other stocks in the portfolio to doso.OutlookDespite some commentators expressing concern that the Biotechnology sector isnow overvalued, the focus of our Portfolio Manager continues to be on theselection of stocks with strong prospects for capital enhancement. Theinvestment portfolio has been constructed not only to provide shareholders withexposure to biotechnology companies with good prospects and at attractivevaluations, but also to allow the Company to benefit from corporate activitywithin the Healthcare sector as a whole, such corporate activity being a keydriver of superior returns within the sector.Your Board believes that the long-term investor in the biotechnology sectorwill continue to be well rewarded.Annual General MeetingThe Annual General Meeting of the Company this year will be held at theBarber-Surgeons' Hall, Monkwell Square, Wood Street, London EC2Y 5BL onWednesday, 8 July 2015 at 12 noon and we hope as many shareholders as possiblewill attend. This will be an opportunity to meet the Board and to receive apresentation from our Portfolio Manager. Shareholders who are unable to attendare encouraged to return their forms of proxy to ensure their votes arerepresented.The Rt Hon Lord Waldegrave of North HillChairman21 May 2015Strategic Report / Investment PortfolioInvestment Portfolio as at 31 March 2015 Country Fair value % ofSecurity /Region £'000 investmentsBiogen United States 63,994 11.0Celgene United States 46,116 7.9Amgen United States 43,790 7.5Gilead Sciences United States 39,142 6.7Illumina United States 23,635 4.0Alexion Pharmaceuticals United States 23,114 4.0Medivation United States 21,649 3.7Neurocrine Biosciences United States 21,365 3.7Incyte United States 19,388 3 3Shire Jersey 19,020 3.3Ten largest investments 321,213 55.1lmpax Laboratories United States 18,936 3.3Horizon Pharmaceutical Ireland 18,799 3.2Bluebird Bio United States 18,791 3.2Regeneron Pharmaceuticals United States 17,639 3.0Receptos United States 17,338 3.0Jazz Pharmaceuticals Ireland 13,385 2.3Affymetrix United States 13,300 2.3GW Pharmaceuticals United Kingdom 12,387 2.1Vertex Pharmaceuticals United States 10,730 1.8Ono Pharmaceutical Japan 10,664 1.8Twenty largest investments 473,182 81.1Pacira Pharmaceuticals United States 10,528 1.8Amag Pharmaceuticals United States 10,124 1.7Fluidigm United States 9,787 1.7Salix Pharmaceuticals United States 9,546 1.7Ironwood Pharmaceuticals United States 9,435 1.6Auspex Pharmaceuticals United States 8,010 1.4Puma Biotechnology United States 7,975 1.4Infinity Pharmaceuticals United States 6,016 1.0Xencor United States 5,346 0.9Actelion Switzerland 5,310 0.9Thirty largest investments 555,259 95.2Newlink Genetics United States 5,161 0.9Innate Pharmaceutical France 4,723 0.8Advaxis United States 4,181 0.7OrbiMed Asia Partners L.P. (unquoted)* Far East 3,439 0.6Dicema Pharmaceuticals United States 3,154 0.5ArQule United States 1,683 0.3Forward Pharma Denmark 1,246 0.2Avalanche Biotechnologies United States 1,165 0.2Cempra United States 1,156 0.2Achillion Pharmaceuticals United States 1,049 0.2Forty largest investments 582,216 99.8Spark Therapeutics United States 993 0.2Total investments 583,209 100.0All of the above investments are equities unless otherwise stated.* Partnership interestPortfolio Breakdown Fair value % ofInvestments £'000 investmentsEquities 579,770 99.4Partnership interest 3,439 0.6Total investments 583,209 100.0Strategic Report / Portfolio Manager's ReviewPerformance ReviewWe are pleased to report that the Company's net asset value per shareincreased 67.4% during the year. This compares to a 63.7% increase in theCompany's benchmark, the NASDAQ Biotechnology Index (measured on a sterlingadjusted basis). The Company's share price increased 69.9% as the discountto net asset value per share narrowed from 6.4% to 4.9%.The leading contributors to performance in the portfolio during the year wereBiogen, Gilead Sciences, Celgene, NeurocrineBiosciences and Medivation.Biogen shares appreciated due to robust sales of Tecfidera for multiplesclerosis and positive phase Ib data of BIIB037 for Alzheimer's disease.Gilead shares appreciated due to strong launches of Sovaldi and Harvoni for thetreatment of Hepatitis C. The combined drugs recorded $12.4 billion total salesin 2014. Patient volumes were significantly higher than expected, and the totalHepatitis C market continues to grow with expanded diagnostic screening.Celgene shares rose due to strong commercial execution and due to positivephase II data of GED-0301 in Crohn's disease.Neurocrine shares appreciated due to positive results from the first of twophase III trials of Elagolix for endometriosis.Medivation shares appreciated due to robust clinical data that led to the U.S.Food and Drug Administration ("FDA") approval for the use of prostate cancerdrug Xtandi in the pre-chemotherapy setting. The label expansion significantlyincreased the value of the company, as it allowed Medivation to capture earlierstage patients and extend the duration that patients receive drug.Whilst there were five leading contributors to performance during the year,there were only three notable detractors, namely;Arrowhead Research, Prothena and Vanda PharmaceuticalsArrowhead shares declined due to disappointing phase II data of ARC-520 forHepatitis B.Prothena shares declined due to the release of disappointing results from thephase I trial of NEOD001 for AL amyloidosis.Vanda shares declined due to a weaker than expected launch of Hetlioz fornon-24-hour sleep-wake disorder.Sector ReviewIt has been another year of remarkable performance for biotech stocks. Sincethe current bull market started in early 2012, the Nasdaq Biotechnology Indexhas outperformed the overall market in 10 of 12 quarters, with a 3-yearcompounded annual growth rate of 43% (vs. 18% for the S&P 500 index). Thestrong stock performance was driven by solid fundamental progress and positiverevisions to earnings estimates for the major biotech companies. GileadSciences, one of the top contributors in our portfolio, experienced thegreatest upward earnings revision in 2014, due to successful launches ofSovaldi and Harvoni for Hepatitis C that significantly exceeded expectations.As a result of impressive commercial execution, the major biotech companieshave accumulated abundant cash on their balance sheets, which will likelycontinue to fuel M&A activities to drive near-term upside for the sector andsupport growth in the long term.Sentiment in Biotech Remains StrongAlthough biotech stocks were weak in the beginning of the year, triggered inpart by concerns over drug pricing, they have since rebounded and reached newhighs. Similarly, a recent correction at the end of March 2015 sent shares downtemporarily but again failed to meaningfully dampen investor enthusiasm. Weconsider these corrections to be healthy instances of market consolidationwhich often provide opportunities to build new positions or add to existingones. Valuations remain attractive among the major biotechnology companies, andwe believe that they still do not fully incorporate the reacceleration ofgrowth from new products that we have previously detailed. Meanwhile, thestrong performance of Puma Biotechnology and Neurocrine Biosciences followingpositive phase III results highlights the importance of clinical data releasesto catalyze stock appreciation in the sector. Given abundant clinical catalystsin 2015, we believe the portfolio is well positioned to benefit from potentialbreakthroughs in emerging therapeutic areas.Biotech Universe Keeps Expanding in a Strong Financing EnvironmentThe IPO class of 2014 hit new records in terms of both the number of publiclistings and proceeds raised. Over 60 biotech companies went public in 2014,with nearly 60% of those new companies listed within or above their IPO ranges.The high IPO activity since 2013 has greatly expanded the number of innovativebiotech companies in which we can invest.New Therapeutic Opportunities: Gene TherapyAs a part of our investment philosophy, we look for investment opportunities infields where rapid clinical advances are being made that may dramaticallytransform the standard of care. Previously we have highlighted multipledevelopments in the immuno-oncology space. This has continued to be an excitingarea of development, and the Company has been able to profit well frominvestments in this space. This year we would like to highlight gene therapy.The concept of gene therapy has been around for a long time. However we are nowbeginning to see significant advances in the clinic, and we believe this fieldcould revolutionize the treatment of a number of diseases in the future.Gene therapy refers to the process of introducing genes into a patient's cellswith the aim of correcting a genetic defect or improving clinical outcomes. Itis an appealing approach, particularly for the treatment of genetic disorders,where it is difficult for conventional therapies to target the root cause ofthe disease at the DNA level. Importantly, by permanently introducing afunctional copy of a gene, gene therapy has the potential to provide a cure forthose diseases. The concept of gene therapy first emerged in the 1970s,followed by some initial successes. However, the field encountered severalsignificant setbacks in the late 1990's and early 2000's due to safety issues.In the past decade, the field of gene therapy has rapidly evolved. The lessonslearned from previous failures have led to significant improvements in thetechnology of gene transfer that serves as a foundation for gene therapy andlargely determines the safety profile of a treatment. The viruses used todeliver genes have been refined or redesigned to minimize safety issues and tobetter accommodate the expression of the incorporated genes. Additionally, thetherapeutic goals have shifted to address more realistically definedindications, particularly those rare diseases that are severe and havemonogenic causes. Over the past few years, remarkable results have beenobtained in clinical trials of AAV- or lentiviral vector-based studies inLeber's congenital amaurosis, hemophilia B, B-thalassemia, and Wiskott-Aldrichsyndrome. In November 2012, uniQure's GLYBERA received approval by the EuropeanCommission and became the first approved gene therapy in the Western world.GLYBERA is an AAV-based vector carrying the lipoprotein lipase gene for thetreatment of severe lipoprotein lipase deficiency. Backed by better science andimproved technology, gene therapy is experiencing a renaissance.According to statistics presented by the U.S. FDA, there are currently 450active gene therapy studies in the US, with 8% being phase III studies and15-20% being phase IIb studies. Although the U.S. FDA has not yet approved ahuman gene therapy product, it has provided a growing body of guidelines toclarify regulatory requirements for gene therapy products. Given thesignificant advancements in technology and improving regulatory environment, weexpect gene therapy to become a viable treatment option for diseases with highunmet medical need in the coming years.The field of gene therapy has now become a significant opportunity forinvestors as a number of the leaders in the field have gone public in therecent wave of biotechnology IPOs. Relevant investments in the Company includepositions in Bluebird Bio, Spark Therapeutics and Avalanche Biotechnologies.Early data from Bluebird Bio provided positive proof-of concept that patientswith B-thalassemia, an inherited disorder that results in the decreasedsynthesis of the B-globin chains of hemoglobin, may be able to achieve afunctional cure with a single infusion of treatment. (Bluebird is furtherhighlighted in the Portfolio Focus section.) Spark Therapeutics is a recentaddition to the portfolio. Spark is developing AAV-vector based gene therapyfor orphan genetic diseases. Its lead candidate, SPK-RPE65, has demonstratedconvincing efficacy in the treatment of RPE65-mediated retinal dystrophy, aninherited disorder that leads to blindness. Additionally, results from variousclinical-stage programs targeting eye diseases, hemophilia, heart failure, andrare genetic disorders will be presented in 2015. We continue to evaluate novelapproaches and we believe the portfolio is well positioned to benefit fromadvances in the field.OutlookAs the biotech sector has outperformed the broader market for the past threeyears, many investors have expressed concern about a possible pullback.However, we would argue that the appreciation of biotech stocks has beenrational, because it tracks with upward revisions to earnings estimates and issupported by fundamental breakthroughs in science and clinical practice. Wecontinue to see new product cycles, earnings growth, and robust pipelineadvancement as a solid justification for valuation of the major biotechcompanies. The price investors pay for the growth in these companies is farfrom the high end seen historically and is attractive compared to largepharmaceutical companies and the broader market.Among the emerging biotech companies, clinical results remain a key driver forstock performance. This year we have highlighted the opportunities in genetherapy. We are encouraged by the early data that suggest functional cures canbe achieved for severe genetic disorders. We look forward to multiple datareadouts in 2015, including phase II data from Avalanche Biotechnologies in wetage-related macular degeneration (a leading cause of blindness in the elderly),phase III data from Spark in a rare form of inherited blindness, and data fromBluebird Bio in B-thalassemia and sickle cell disease. We continue to bebullish on immuno-oncology. The first PD-1 inhibitors were approved for thetreatment of melanoma in 2014. We believe various combination therapies withPD-1 inhibitors will extend the benefit of immunotherapy to a larger number ofpatients by promoting higher response rates in established indications, and byincreasing the number of tumor types addressable by immunotherapy. Toward thisend, we look forward to data from portfolio companies Incyte and Innate Pharma.M&A activity will continue to be a major catalyst in the sector as largepharmaceutical and biotech companies seek growth and pipeline assets. Duringthe review period, we have seen another major boost to biotech from the $21billion acquisition of Pharmacyclics by Abbvie, which set a new high-water markfor the value of an oncology asset. Many of the portfolio companies withde-risked assets or leading technologies, such as Incyte, Medivation, Puma, andBluebird Bio, are potential candidates for acquisition.The number of holdings in the Company as at 31 March 2015 was 41 and the numberof holdings has not materially changed since the year end. Currentlyapproximately 50% of the Company's assets are invested in emergingbiotechnology companies, and 50% are invested in major biotechnology companies.With attractive valuation and abundant clinical and regulatory catalysts, webelieve that the sector though volatile is well positioned to continue itspositive momentum.Sven BorhoOrbiMed Capital LLC, Portfolio Manager21 May 2015Strategic Report / Portfolio FocusPuma BiotechnologyPuma is an emerging biotechnology company focused on the development of smallmolecules for the treatment of cancer. Its lead development compound isneratinib, an oral, irreversible inhibitor of the HER2 receptor. Neratinib iscurrently being studied in various stages of HER2+ or HER2 mutated breastcancer, and other solid tumors with HER2 mutations.Puma shares appreciated nearly 300% after the announcement of positive phaseIII results of neratinib for HER2+ breast cancer following Herceptin-basedadjuvant therapy last July. The data showed treatment with neratinib resultedin a 33% reduction in cancer recurrence or death versus placebo. The largeeffect size suggests neratinib will become a new standard of care and sets ahigh bar for other adjuvant drugs in development. We believe Puma shares remainundervalued relative to the opportunity for neratinib in adjuvant breastcancer.This year Puma will report phase II neoadjuvant data in breast cancer, and thecompany will present full data in adjuvant as well as metastatic settings atmedical conferences. We believe neratinib has a differentiated clinical profilethat can provide benefits across several lines of therapy. Furthermore, withpositive phase III data in an indication with multi-billion dollar marketpotential, we see Puma as a prime acquisition candidate.Neurocrine BiosciencesNeurocrine Biosciences is an emerging biopharmaceutical company focused onneurological and endocrine diseases. The company has three drugs indevelopment: 1) elagolix, a GnRH antagonist in Phase 3 for endometriosis anduterine fibroids, partnered with AbbVie, 2) NBI-98854, a VMAT-2 inhibitor inPhase 3 for tardive dyskinesia, and 3) NBI-77860, a CRF1 receptor antagonist inPhase 1 for congenital adrenal hyperplasia. Endometriosis is a conditionaffecting 170 million women worldwide characterized by abnormal growth ofendometrial tissue outside of the uterus, leading to excessive pain andbleeding during menstruation. Elagolix is an oral treatment that reducesproduction of certain hormones in women, thereby alleviating the symptoms ofendometriosis.Our investment thesis in Neurocrine was premised on our expectation that Phase3 results for elagolix in early 2015 would be positive, based on our ownanalysis of the trial's design and previous trial results. In January 2015,Neurocrine and AbbVie announced that the trial had indeed successfully met itsco-primary endpoints of reducing pain associated with endometriosis with anacceptable safety profile.The company has a number of additional value-creating catalysts in the secondhalf of 2015, including Phase 2b results for elagolix in uterine fibroids,Phase 3 results for NBI-98854 in tardive dyskinesia, and Phase 2 results forNBI-77860 in congenital adrenal hyperplasia. We remain investors in the companybecause we believe these catalysts will be positive.Bluebird BioBluebird Bio is a clinical-stage biotech company focused on developing genetherapies for severe genetic and rare diseases. It has a leading gene therapyplatform, including vectors, transduction protocol, and manufacturingprocesses, that has been optimized to deliver consistent gene therapies atscale. The company takes an ex vivo, lentivirus-based approach to introducegenetic modification to the patient's own hematopoietic stem cells, and thenreintroduce the cells into the body. The company has generated proof-of-conceptdata in two genetic conditions: β-thalassemia, an autosomal recessive diseaseof red blood cell dysfunction characterized by severe anemia, and childhoodcerebral adrenoleukodystrophy (CCALD), an X-linked disorder of progressiveneurodegenerative decline. The company also has a strategic collaboration withCelgene to develop modified T cell products to treat liquid and solid tumorcancers.Bluebird's product candidate for β-thalassemia is known as LentiGlobin. Itconsists of a lentiviral vector carrying a single-codon variant of the β-globingene. β-thalassemia is an inherited disorder that results in the decreasedsynthesis or complete absence of the β-globin chains of hemoglobin, so patientsmust frequently undergo regular blood transfusions. Bluebird presented interimdata from two phase I/II clinical trials of LentiGlobin at the 2014 AmericanSociety of Hematology conference, which showed impressive efficacy. The firstfour patients treated all achieved transfusion independence for at least 3months, and two of them achieving transfusion-free status for 9 and 12 months,respectively. These results suggest the possibility of functional cures withone single infusion of therapy. LentiGlobin recently received the BreakthroughTherapy designation from the FDA for treating transfusion-dependent patientswith β-thalassemia. LentiGlobin is also being developed for sickle celldisease, a related indication caused by production of abnormal hemoglobinchains. The hemoglobin variant causes red blood cells to assume a sickle-likeshape which can put patients at risk of stroke, shortness of breath, and suddenor chronic pain throughout the body. Phase I data in this indication areexpected in 2015.A second advanced product candidate is Lenti-D, which is in phase II/IIIclinical studies for the treatment of childhood cerebral adrenoleukodystrophy(CCALD) - a rare, hereditary neurological disorder affecting young boys causedby mutations on the ABCD1 gene. Currently, the only effective treatment forCCALD is allogeneic stem cell transplantation (SCT). Lenti-D consists of alentiviral vector carrying the ABCD1 gene and presents a potential improvementover SCT. Proof-of-concept for the company's approach comes from a four-patientCCALD trial conducted in France using a related lentiviral gene therapy vector.In this study, 3 of 4 patients experienced a good response to therapy that hasbeen shown to be durable for over six years. The company's phase II/III studywill yield data in 2016.Strategic Report / OrbiMed Capital LLCFirm HistoryOrbiMed's investment business was founded in 1989 with a vision to investacross the spectrum of healthcare companies: from venture capital start-ups tolarge multinational companies.Beginning with our first public equity fund in 1989, the Firm expanded toinclude long/short equity and private equity investments in 1993. In 2007 thefirm expanded to Asia, opening offices in Mumbai and Shanghai, and launching afund focused on private equity healthcare opportunities in China and India. In2010 the Firm expanded to the Middle East, opening an office in Israel to seekinnovative life sciences venture capital opportunities across the region. In2011 OrbiMed launched a Royalty Opportunities fund, focused on investing inhealthcare royalty streams.Today, OrbiMed has a singular focus on seeking successful investments on aworldwide basis across the entire spectrum of private and publicly-traded lifesciences companies. With approximately $14 billion in net assets undermanagement, OrbiMed ranks as the world's largest healthcare-dedicatedinvestment firm.OrbiMed's investment professionals possess a combination of extensivescientific, medical, and financial expertise. The following five individualsrepresent the portfolio management team for the Company:The OrbiMed Team for the CompanyMr. Samuel D. Isaly is the Managing Partner of OrbiMed. Mr. Isaly is one of theworld's most recognised healthcare fund managers and has been active in globalhealthcare investing and analysis since 1968 when he joined Chase ManhattanBank in New York. During his career, Mr. Isaly has been a pharmaceuticalanalyst with Chase Manhattan Bank, Merrill Lynch, Legg Mason, and S.G. Warburg.Mr. Isaly launched OrbiMed's asset management business in 1989. Mr. Isaly has aB.A. in Economics from Princeton University and a M. Sc. (Econ.) from TheLondon School of Economics.Mr. Sven H. Borho, CFA,is a founding Partner of OrbiMed. Mr. Borho's biographycan be found within the Directors' biography.Mr. Geoffrey C. Hsu, CFA,is a Partner at OrbiMed. He joined OrbiMed in 2002 asa biotechnology analyst. Prior to joining OrbiMed, he worked as a financialanalyst in the healthcare investment banking group at Lehman Brothers. Mr. Hsureceived his A.B. degree summa cum laude from Harvard University and holds anM.B.A. from Harvard Business School. Prior to business school, he spent twoyears studying medicine at Harvard Medical School.Mr. Richard D. Klemm, Ph.D., CFA, is a Public Equity Partner focused onbiotechnology companies. He completed a Ph.D. from the Massachusetts Instituteof Technology in molecular biology in 2000. Dr. Klemm has published scientificarticles in the fields of DNA replication and transcription. He received a B.A.from the University of California, Berkeley in 1994 with majors in molecularand cell biology and economics.Haige Lu, Ph.D,is an Analyst focused on biotechnology companies. Prior tojoining OrbiMed, he worked as a Research Fellow at Memorial Sloan-KetteringCancer Centre. He received his Ph.D. from Stanford University in ChemicalBiology and his B.S. in Chemistry from Peking University in China.Strategic Report / Principal Contributors to and Detractors from Net Asset ValueTop and bottom five contributors to Net Asset Value performance for the yearended 31 March 2015Top Five Contributors Contribution for the year ended Contribution per 31 March 2015 share £'000 (pence)*Biogen 21,248 32.5pGilead Sciences 20,439 31.3pCelgene 15,644 23.9pNeurocrine Biosciences 13,331 20.4pMedivation 12,797 19.6p 83,459 127.7pTop Five Detractors Contribution for the year ended Contribution per 31 March 2015 share £'000 (pence)*Arrowhead Research (5,841 ) (8.9p )Prothena (3,483 ) (5.3p )Vanda Pharmaceuticals (1,741 ) (2.7p )BioMarin (743 ) (1.1p )Pacira Pharmaceuticals (455 ) (0.7p ) (12,263 ) (18.7p )* based on 65,319,717 (excluding shares held in treasury) ordinary shares beingthe weighted average number of shares in issue during the year ended 31 March2015.Strategic Report / Business ReviewThe Directors present their Strategic Report for the Company for the year ended31 March 2015. The Strategic Report contains a review of the Company's businessmodel and strategy, an analysis of its performance during the financial yearand its future developments and details of the principal risks and challengesit faces. Its purpose is to inform the shareholders in the Company and helpthem to assess how the Directors have performed their duty to promote thesuccess of the Company.Principal Service ProvidersThe principal service providers to the Company are Frostrow Capital LLP(Frostrow), OrbiMed Capital LLC (OrbiMed) and J.P. Morgan Chase Clearing Corp(J.P. Morgan). Details of their responsibilities are set out below.Alternative Investment Fund Manager (AIFM)As reported in the half year report to 30 September 2014 the Company appointedFrostrow as its AIFM during the year. Under the terms of its AIFM agreementwith the Company, Frostrow provides, inter alia, the following services:risk management services;marketing and shareholder services;administrative and secretarial services;advice in respect of the modus operandi of the investment company sectorincluding, corporate governance requirements;maintains the Company's accounting records;maintaining professional indemnity insurance at the level required under theAIFM Rules in order to cover potential liability risks arising fromprofessional negligence;prepares and dispatches the annual and half yearly reports and monthlyfactsheets; andupholds compliance with applicable tax, legal and regulatory requirements.Portfolio ManagerUnder the terms of its portfolio management agreement with the AIFM and theCompany, OrbiMed provides, inter alia, the following services:seeking out and evaluating investment opportunities;recommending the manner by which monies should be invested, disinvested,retained or realised;advising on how rights conferred by the investments should be exercised;analysing the performance of investments made; andadvising the Company in relation to trends, market movements and other matterswhich may affect the investment objective and policy of the Company.Prime Broker and CustodianDuring the year the Company appointed J.P. Morgan Europe Limited as itsdepositary and J.P. Morgan Clearing Corp. (J.P. Morgan) as prime broker andcustodian. These new arrangements replaced the Company's existing custody andprime brokerage arrangements with Goldman Sachs & Co.J.P. Morgan Europe Limited has discharged its liability under article 21(12) ofthe Directive in respect of its obligations under the first and secondparagraphs of that article, regarding its liability for loss of financialinstruments held by the prime broker.J.P. Morgan Clearing Corp. as a prime broker provides the following services,inter alia, under its agreements with the Company:safekeeping and custody of the Company's investments and cash;provision of an overdraft facility; andderivative and foreign exchange services.Further details of contractual arrangements with the principal serviceproviders, including fees, are included within the Directors Report.Strategic Report / Business ReviewInvestment Objective and PolicyTo seek capital appreciation through investment in the worldwide biotechnologyindustry. In order to achieve its investment objective, the Company invests ina diversified portfolio of shares and related securities in biotechnologycompanies on a worldwide basis. Performance is measured against the NASDAQBiotechnology Index (sterling adjusted).The Directors, as advised by the Company's AIFM and Portfolio Manager, agreedin November 2014 that the Company's borrowing limit should be increased from10% to 15% of the Company's net assets. Shareholders were notified of thischange and the Directors' commitment to continue to keep the borrowing limitunder review via the Chairman's Statement contained within the Half Year Reportdated 10 November 2014.Shareholder approval to increase the Company's borrowing limit from 15% to 20%was obtained at a General Meeting held on 31 March 2015.The Company's approach to using borrowing will not change in practice and thelevel of borrowing adopted will continue to be reviewed and agreed with theDirectors and the Company's AIFM from time to time, subject always to theproposed overall limit of 20% of the Company's net assets.Investment ApproachThe Company's Portfolio Manager is OrbiMed Capital LLC ("OrbiMed").OrbiMed, based in New York, is a portfolio manager focused exclusively on thehealthcare sector, with approximately U.S.$14 billion in assets undermanagement as at 31 March 2015 across a range of funds, including investmenttrusts, hedge funds and private equity funds. OrbiMed's investment managementactivities were founded in 1989 by Mr. Samuel D. Isaly. Further details onOrbiMed can be found within the Strategic Report.Consistent with the revised mandate which was implemented in October 2013,OrbiMed has invested the Company's assets in the worldwide biotechnologyindustry. Geographic allocation is in line with the geographic distribution ofinvestment opportunities, with the majority of the Company's investments incompanies based in North America. The portfolio comprised 41 holdings as at 31March 2015 (2014: 46 holdings).OrbiMed takes a bottom-up approach to stock selection based on intensiveproprietary research. Stock selection is based on rigorous financial analysis,exhaustive scientific review, frequent meetings with company management andconsultations with physicians and other industry experts.OrbiMed looks for strong management teams, healthy organic growth from currentproducts and deep pipelines to fuel future growth.Portfolio risk management is conducted via position size limits and geographicdiversification. The Company maintains adequate portfolio liquidity by limitingthe Company's ownership to 15% of an individual company's equity (at the timeof investment) and by strictly limiting the Company's exposure to directunquoted companies to 10% of the portfolio at the time of acquisition.Investment LimitationsThe Board seeks to manage the Company's risk by imposing various investmentlimits and restrictions as follows:The Company will not invest more than 10%, in aggregate, of the value of itsgross assets in other closed ended investment companies (including investmenttrusts) listed on the London Stock Exchange, except where the investmentcompanies themselves have stated investment policies to invest no more than 15%of their gross assets in other closed ended investment companies (includinginvestment trusts) listed on the London Stock Exchange.The Company will not invest more than 15%, in aggregate, of the value of itsgross assets in other closed ended investment companies (including investmenttrusts) listed on the London Stock Exchange.The Company will not invest more than 15% of the value of its gross assets inany one individual stock at the time of acquisition.The Company will not invest more than 10% of the value of its gross assets indirect unquoted investments at the time of acquisition. This limit does notinclude any investment in private equity funds managed by the Portfolio Manageror any affiliates of such entity.Strategic Report / Business ReviewThe Company may invest or commit for investment a maximum of US$15 million,after the deduction of proceeds of disposal and other returns of capital, inprivate equity funds managed by OrbiMed, the Company's Portfolio Manager, or anaffiliate thereof.Prior to the General Meeting held on 31 March 2015, the Company's borrowingpolicy was that borrowing would not exceed 15% of the Company's net assets.With effect from the 31 March 2015 the Company's borrowing policy is thatborrowing will not exceed 20% of the Company's net assets. The Company'sborrowing requirements are met through the utilisation of an overdraftfacility, repayable on demand and provided by J.P. Morgan Clearing Corp. Thisfacility can be drawn at the discretion of the AIFM.The Company may be unable to invest directly in certain countries. In thesecircumstances, the Company may gain exposure to companies in such countries byinvesting indirectly through swaps. Where the Company invests in swaps,exposure to underlying assets will not exceed 5% of the gross assets of theCompany at the time of entering into the contract.In accordance with the requirements of the UK Listing Authority, any materialchange to the investment policy will only be made with the approval ofshareholders by ordinary resolution.Dividend PolicyThe Company invests with the objective of achieving capital growth and it isexpected that dividends, if any, are likely to be small. The Board intends onlyto pay dividends on the Company's shares to the extent required in order tomaintain the Company's investment trust status.Company PromotionThe aim of the Company's promotional activities is to encourage demand for theCompany's shares. The Company has appointed Frostrow Capital LLP to providemarketing services, in the belief that a well-marketed investment company ismore likely to grow over time, have a more diverse, stable list of shareholdersand its shares will trade at close to NAV per share over the long run. Frostrowactively promotes the Company in the following ways:Engaging regularly with institutional investors, discretionary wealth managersand a range of execution-only platforms:Frostrow regularly talks and meets with institutional investors, discretionarywealth managers and execution-only platform providers to discuss the Company'sstrategy and to understand any issues and concerns, covering both investmentand corporate governance matters;Making Company information more accessible: Frostrow works to raise the profileof the Company by targeting key groups within the investment community, holdingannual investment seminars, overseeing PR output and managing the Company'swebsite and wider digital offering, including investment manager webcasts andsocial media;Disseminating key Company information:Frostrow performs the Investor Relationsfunction on behalf of the Company and manages the investor database. Frostrowproduces all key corporate documents, distributes Monthly Factsheets, AnnualReports and updates from Orbimed on the portfolio and market developments; andMonitoring market activity, acting as a link between the Company, shareholdersand other stakeholders: Frostrow maintains regular contact with sector BrokerAnalysts and other research and data providers, and conducts periodic investorperception surveys, liaising with the Board to provide up-to-date and accurateinformation on the latest shareholder and market developments.Key Performance IndicatorsThe Board assesses its performance in meeting the Company's objective againstthe following Key Performance Indicators ("KPI's"):Net asset value return Share Stock Share price Ongoingagainst the NASDAQ price contribution discount/premium chargesBiotechnology Index return analysis to net asset ratio(sterling adjusted) value per shareDuring the year the Company appointed Frostrow as its AIFM in order to complywith the AIFMD. The management of the portfolio has in turn been delegated toOrbiMed under the terms of a portfolio management agreement. In addition to itsrole as AIFM, Frostrow is also responsible for company secretarial,administration and marketing services to the Company. Each provider isresponsible to the Board which is ultimately responsible to shareholders forperforming against the above KPIs.Net asset value returnThe Directors regard the Company's net asset value total return as being theoverall measure of value delivered to shareholders over the long term. Totalreturn reflects the net asset value growth of the Company. OrbiMed's investmentstyle is such that performance is likely to deviate from that of the benchmarkindex. The Board considers the most important comparator to be the NASDAQBiotechnology Index (sterling adjusted).During the year under review the Company's net asset value per share return was67.4% outperforming the benchmark by 3.7%.A full description of performance during the year under review and theinvestment portfolio is contained in the Portfolio Manager's Review.Share price returnThe Directors also regard the Company's share price return to be a keyindicator of performance. This is monitored closely by the Board.During the year under review the Company's share price return was 69.9%.Stock contribution analysisThe Board together with the AIFM undertakes a regular review of the portfolioand in particular the principal contributors to and detractors from net assetvalue.The Portfolio Manager provides a detailed explanation of portfolio performanceat each Board Meeting.Share discount/premium price to net asset value per shareThe Board undertakes a regular review of the level of discount/premium andconsideration is given to ways in which share price performance may beenhanced, including the effectiveness of marketing and share issuance andbuy-backs, where appropriate. The Board has a discount control mechanism inplace intended to establish a target level of no more than a 6% discount ofshare price to the net asset value per share. Shareholders should note,however, that it remains possible for the share price discount to net assetvalue per share to be greater than 6% on any one day due to the fact that theshare price continues to be influenced by overall supply and demand for theCompany's shares in the secondary market. The volatility of the net asset valueper share in an asset class such as biotechnology is another factor over whichthe Board has no control. The making and timing of any share buy-backs or shareissuance is at the absolute discretion of the Board.During the year under review 4,445,522 shares were bought back to be held intreasury by the Company.Demand for the Company's shares led to the issue of a total of 110,000 sharesfrom treasury during the year at a price representing a small premium to NAVper share.To meet this demand the Company published a Prospectus in July 2013. However,on 28 April 2014 the Board exercised their discretion to suspend the PlacingProgramme under the Prospectus, as in the short term the Board believed thatfurther share issues can be made within the current limits approved byShareholders.The discount of the Company's share price to the net asset value per share at31 March 2015 stood at 4.9% (2014: 6.4%).Ongoing charges ratioThe Board continues to be conscious of expenses and works hard to maintain asensible balance between strong service and costs.As at 31 March 2014 the ongoing charges ratio was 1.2% (2013: 1.3%) which wasmarginally less than the percentage for the previous year.Risk ManagementThe Board is responsible for the management of the risks faced by the Companyand the Board regularly review these risks and how risk is mitigated. The Boardhas categorised the risks faced by the Company under ten headings as follows:Objective Level of Portfolio Operational Market Liquidity Shareholder Currency Overdraft Creditand discount Performance and Price Risk Profile Risk Facility RiskStrategy /premium Regulatory RisksThe Board is responsible for the management of the risks faced by the Companyand the Board regularly review these risks and how risk is mitigated. The Boardcarries out a robust assessment of the risks that face company including thosethat would threaten its business model, future performance and liquidity.Principal Risks and Uncertainties Management/MitigationObjective and Strategy The Board reviews regularly the Company's investment objective and investment guidelines in the light of investor sentiment monitoring closely whether the Company should continue in its present form. The Board also considers the size of the Company to ensure that it is at an optimum level. The Board, through the AIFM and the Portfolio Manager, holds regular discussions with major shareholders. AThe Company becomes unattractive to continuation vote is to be held at theinvestors. forthcoming Annual General Meeting and if passed every five years thereafter. Each month the Board receives a report which monitors the investments held in the portfolio compared against the benchmark index and the investment guidelines. Additional reports and presentations are regularly presented to investors by the Company's AIFM and Portfolio Manager.Level of discount/premium The Board undertakes a regular review of the level of discount/premium and consideration is given to ways in which share price performance may be enhanced, including the effectiveness of marketing and share issuance and buy-backs, if considered appropriate. The Board has anThe risk of the Company's share active discount management policy inprice not being representative of place, buying back the Company's sharesits underlying net assets. to hold in treasury or for cancellation if the market price is at a discount greater than 6% to the net asset value per share. The making and timing of any share issuance or buy-backs is at the absolute discretion of the Board.Portfolio Performance The Board reviews regularly investment performance against the benchmark and against the Company's peer group. The Board also receives regular reports that show an analysis of performance compared to other relevant indices. The Portfolio Manager provides an explanation ofInvestment performance may not be significant stock selection decisionsmeeting shareholder requirements. and an overall rationale for the make-up of the portfolio. The Portfolio Manager discusses current and potential investment holdings with the Board on a regular basis.Operational and Regulatory All transactions and income and expenditure forecasts are reviewed byA breach of Sections 1158 and 1159 the Board at each Board Meeting. Theof the Corporation Tax Act 2010 Board considers regularly all majorcould lead to the Company being risks, the measures in place to controlsubject to tax on capital gains, them and the possibility of any otherwhilst a serious breach of other risks that could arise. The Board alsoregulatory rules (including those ensures that satisfactory assurances areassociated with the Alternative received from service providers. TheInvestment Fund Managers Directive) Compliance Officer of the AIFM and ofmay lead to suspension from the the Portfolio Manager produce regularStock Exchange or to a qualified reports for review at the Company'sAudit Report. Other control Audit and Management Engagementfailures, either by the AIFM, the Committee meetings and are available toPortfolio Manager or any other of attend such meetings in person ifthe Company's service providers, may required.result in operational and/orreputational problems, erroneousdisclosures or loss of assetsthrough fraud, as well as breachesof regulations.Market Price Risks The Board meets on a quarterly basis during the year and on an ad hoc basis if necessary. At each meeting the Directors consider the asset allocation of the portfolio in order to minimise the risk associated with particular countries, sectors, or instruments. TheUncertainty about future prices of Portfolio Manager has responsibility forfinancial instruments held. selecting investments in accordance with the Company's investment objective and seeks to ensure that investment in individual stocks falls within acceptable risk levels.Liquidity Risk Ability to meet funding requirements when they arise. The Portfolio Manager has constructed the portfolio so that funds can be raised at short notice if required.Shareholder Profile Activist shareholders whose interests are not consistent with the long-term objectives of the Company may be attracted onto the shareholder register. The AIFM provides a shareholder analysis at every Board Meeting so that the Board can give consideration as to any action required; this is in addition to regular reporting by the Company's Stockbroker. The Board has implemented an active discount management policy.Currency Risk Movements in exchange rates could adversely affect the performance of the portfolio. A significant proportion of the Company's assets is, and will continue to be, invested in securities denominated in foreign currencies, in particular U.S. dollars. As the Company's shares are denominated and traded in sterling, the return to shareholders will be affected by changes in the value of sterling relative to those foreign currencies. The Board has made clear the Company's position with regard to currency fluctuations which is that it does not currently hedge against currency exposure.Overdraft Facility The provider of the Company's overdraft facility may no longer be prepared to lend to the Company. The Board, the AIFM and the Portfolio Manager are kept fully informed of any likelihood of the withdrawal of the overdraft facility so that repayment can be effected in an orderly fashion. The Company's borrowing requirements are met through the utilisation of an overdraft facility, repayable on demand, provided by J.P. Morgan Clearing Corp.Credit Risk The Company's assets can be held by J.P. Morgan Clearing Corp. as collateral for the loan provided by them to the Company. Such assets taken as collateral may be used, loaned, sold, rehypothecated or transferred by J.P. Morgan Clearing Corp., although the Company maintains the economic benefits from ownership of those assets. J.P. Morgan Clearing Corp may take up to 140% of the value of the outstanding overdraft as collateral. Assets held by J.P. Morgan Clearing Corp, as Prime Broker, that are not used as collateral, are held in segregated client accounts. Further information on financial instruments and risk, as required by IFRS 7, can be found in note 13 to the financial statements.Investment Trends and OutlookThe Portfolio Manager takes a bottom-up approach to stock selection based onintensive proprietary research. Stock selection is based on rigorous financialanalysis, exhaustive scientific review, frequent meetings with companymanagement and consultations with physicians and other industry experts.The Portfolio Manager seeks to invest in biotechnology companies with strongmanagement teams, innovative products in development and sufficient financialresources to develop those products.The attainment of profitability frequently acts as a significant catalyst forbiotech share price appreciation. As a result, the Portfolio Manager believessuperior returns can be achieved by investing in emerging biotechnologycompanies two to three years prior to sustainable profitability. Companies thatbecome profitable benefit from greater analyst research coverage, a widerinstitutional investor base and reduced clinical development risk (sinceprofitability typically coincides with a product approval and launch). ThePortfolio Manager generally seeks to exit its investments when the widerinvestor community starts to value a newly profitable biotechnology company inexcess of its anticipated future growth.Risk management is conducted via position size limits, geographicdiversification and an appropriate weighting between major and emergingbiotechnology.The Company believes that the biotechnology sector's strong performance duringthe Company's financial year was justified based on the solid fundamentals ofthe sector. It further believes that earnings per share growth within theSector for the next few years will be strong due, in part, to new productlaunches from a number of major biotechnology companies. In addition to thesenew products, it also believes that there are several late stage products fromsmaller biotechnology companies with significant potential and that the sectoris still attractive relative to large pharmaceutical companies and the generalmarket given the biotechnology sector's substantial potential.Strategic Report / Business ReviewDirector, Social, Economic and Environmental Matters and Looking to the FutureDirectorsThe Directors of the Company, who served during the year, are shown below.The Rt Hon Lord Waldegrave of North Hill (Chairman of the Board and NominationCommittee)Sven BorhoProfessor Dame Kay Davies DBEPaul GauntDr John Gordon (retired from the Board on 10 July 2014)Andrew Joy (Senior Independent Director and Chairman of the RemunerationCommittee)Peter Keen (Chairman of the Audit and Management Engagement Committee)Board DiversityThe Company is supportive of the recommendations of Lord Davies' Report thatthe performance of corporate boards can be improved by encouraging theappointment of the best people from a range of differing perspectives andbackgrounds. The Company recognises the benefits of diversity on the Board,including gender, and takes this into account in its Board appointments. TheCompany is committed to ensuring that any director search process activelyseeks persons with the right qualifications so that appointments can be made onthe basis of merit against objective criteria from a diverse selection ofcandidates. To this end the Board will continue to consider diversity duringany director search process and note that the Davies Review of Women on Boardrecommended that UK listed companies in the FTSE 100 should be aiming for aminimum of 25% of females on the Board.The Company does not have any employees. Therefore there is no employeeinformation to disclose. Male FemaleDirectors of the Company 5 1Social, Economic and Environmental MattersThe Directors, through the Company's Portfolio Manager, encourage companies inwhich investments are made to adhere to best practice with regard to corporategovernance. In light of the nature of the Company's business there are norelevant human rights issues and the Company does not have a human rightspolicy.The Company recognises that social and environmental issues can have an effecton some of its investee companies.The Company is an investment trust and so its own direct environmental impactis minimal. The Board of Directors consists of six Directors, five of whom areresident in the UK and one resident in the United States. The Board holds themajority of its regular meetings in the United Kingdom and has a policy thattravel, as far as possible, is minimal, thereby minimising the Company'sgreenhouse gas emissions.Looking to the FutureThe Board concentrates its attention on the Company's investment performanceand OrbiMed's investment approach and on factors that may have an effect onthis approach. Marketing reports are given to the Board at each Board meetingby the AIFM which include how the Company will be promoted and details ofplanned communications with existing and potential shareholders. The Board isregularly updated by the AIFM on wider investment trust industry issues anddiscussions are held at each Board meeting concerning the Company's futuredevelopment and strategy.A review of the Company's year, its performance since the year-end and theoutlook for the Company can be found in the Chairman's Statement and in thePortfolio Manager's Review.The Company's Portfolio Manager believes that the outlook remains positive forthe biotechnology sector, with a strong earnings growth outlook for majorbiotech companies and robust development pipelines from emerging biotechcompanies. The Portfolio Manager believes that the portfolio is well positionedto capitalise on the opportunities in the sector.The Company's overall strategy remains unchanged.ApprovalThe Strategic Report was approved by the Board of Directors on 21 May 2015 andsigned on its behalf by:The Rt Hon Lord Waldegrave of North HillChairmanGovernance / Board of Directors The Rt Hon Lord Waldegrave Of North Sven Borho Hill Sven Borho joined the Board in Chairman of the Board and Nomination March 2006 and is a founding Committee Partner of OrbiMed, the Company's Portfolio Manager. He heads the The Rt Hon Lord Waldegrave of North public equity team and is the Hill joined the Board in June 1998. portfolio manager for OrbiMed's He is Provost of Eton College, public equity and hedge funds. Sven Chairman of Coutts and Co Limited and has played an integral role in the Chairman of the Royal Mint Advisory growth of OrbiMed's asset Committee. He was formerly management activities. In 1991 he Vice-Chairman of the Investment joined OrbiMed's predecessor and Banking Department at UBS, Chairman was promoted to portfolio manager of the Global Financial Institutions in 1993. He studied business Group at Dresdner Kleinwort administration at Bayreuth Wasserstein and a Director of Fleming University in Germany and received Family Partners. From 1979 to 1997, a M.Sc. (Econs.), Accounting and he was MP for Bristol West holding a Finance, from The London School of number of Cabinet posts including Economics. Secretary of State for Health. Professor Dame Kay Davies, DBE Paul Gaunt Professor Dame Kay Davies, DBE joined Paul Gaunt joined the Board in June the Board in March 2012. She is the 1997. Paul is self-employed and has Dr. Lee's Professor of Anatomy and over 30 years' experience in the Associate Head of the Medical investment industry. He was Sciences Division at the University formerly Senior Investment Manager of Oxford and a fellow of Hertford and an Assistant General Manager of College. She is also a Director of The Equitable Life Assurance the MRC Functional Genomics Unit at Society and a Director of Allianz Oxford, an Independent Director of Technology Trust PLC, Worldwide UCB Pharma S.A, Deputy Chairman of Healthcare Trust PLC, Brit the Wellcome Trust and a member of Insurance Holdings Limited the Scientific Advisory Boards of (formerly PLC) and of Oasis biopharmaceutical companies UCB Healthcare plc. Pharma S.A. and ProSensa plc and a consultant to drug discovery company Summit plc. As part of her role as Deputy Chairman of the Wellcome Trust she serves on the GRL Board (Sanger Institute) and the Genome England Board (NHS). Andrew Joy Peter Keen Senior Independent Director and Chairman of the Audit and Chairman of the Remuneration Management Engagement Committee Committee Peter Keen has served on the Board Andrew Joy joined the Board in March as a Director since the launch of 2012. He was one of the founding the Company in June 1997 and is Partners of Cinven where he continues Chairman of the Audit and as a Senior Advisor. He is a Senior Management Engagement Committee. A Advisor of Stonehage Fleming Family & Chartered Accountant he has over Partners Group and Chairman of the 30 years' experience in the private equity investment committee. management and financing of life Mr. Joy has been Chairman or Director science businesses. He is Chief of numerous growing companies over Executive of the technology the past 30 years. He is a former investment firm Cambridge Chairman of the BVCA (British Venture Innovation Capital plc and has Capital and Private Equity served on the board of many private Association) and Director of the and public companies. He is EVCA. currently a Director of MRC Technology Ltd and Congenica Ltd. For nine years he was the Senior Independent Director of Abcam plc and was a co-founder of Chiroscience Group plc. All Directors, with the exception of Sven Borho, are members of the Audit and Management Engagement, Nominations and Remuneration Committees. All members of the Board are non-executive Directors, each of whom is independent of the Portfolio Manager, with the exception of Mr. Sven Borho who is a Founding General Partner of OrbiMed, the Company's Portfolio Manager and is not considered to be an Independent Director, none of the Directors have been employed by any of the companies in which the Company holds an investment, or any of the Company's service providers.Governance / Board of DirectorsThe Board and CommitteesScheduled MeetingsThe table below sets out the number of scheduled Board and Committee meetingsheld during the year ended 31 March 2015 and the number of meetings attended byeach Director. Audit and Management Engagement Nominations Remuneration Board Committee Committee CommitteeNumber of meetings held in 2014/15: 4 3 1 1The Rt Hon Lord Waldegrave of NorthHill 4 3 1 1Sven Borho^ 4 - - -Professor Dame Kay Davies, DBE 4 3 1 1Paul Gaunt 4 3 1 1Dr. John Gordon* 2 2 1 1Andrew Joy 4 3 1 1Peter Keen 4 3 1 1All of the Directors attended the Annual General Meeting held on 10 July 2014.^ Sven Borho is not a member of any of the Company's committees.* Dr. Gordon retired from the Board on 10 July 2014.In addition to the scheduled Board meetings there were a number of unscheduledBoard Meetings to consider matters such as the regulations concerning theAlternative Investment Fund Managers Directive and matters concerning theBoard's decision to undertake an audit tender and the subsequent appointment ofnew auditors.Directors' InterestsThe beneficial interests of the Directors and their families in the Company areset out within the Directors Remuneration Report.Governance / Corporate GovernanceThis Statement forms part of the Report of the Directors.The Board has considered the principles and recommendations of the AIC Code ofCorporate Governance (AIC Code) by reference to the AIC Corporate GovernanceGuide for Investment Companies (AIC Guide). The AIC Code, as explained by theAIC Guide, addresses all the principles set out in the UK Corporate GovernanceCode, as well as setting out additional principles and recommendations onissues that are of specific relevance to the Company.The Board considers that reporting against the principles and recommendationsof the AIC Code, and by reference to the AIC Guide (which incorporates the UKCorporate Governance Code), will provide better information to shareholders.The Company has complied with the recommendations of the AIC Code and therelevant provisions of the UK Corporate Governance Code, except as set outbelow.The UK Corporate Governance Code includes provisions relating to:directorstenurethe role of the chief executiveexecutive directors' remunerationthe need for an internal audit functionFor the reasons set out in the AIC Guide, and as explained in the UK Corporategovernance Code, the Board considers these provisions are not relevant to theposition of the Company, being an externally managed investment company. Inparticular, all of the Company's day-to-day management and administrativefunctions are outsourced to third parties. As a result, the Company has noexecutive directors, employees or internal operations. Therefore with theexception of Director tenure, and the need for an internal audit function, theCompany has not reported further in respect of these provisions.The Principles of the AIC CodeThe AIC Code is made up of twenty-one principles split into three sectionscovering:The BoardBoard Meetings and relations with Frostrow and OrbiMedShareholder CommunicationsAIC CodePrinciple Compliance StatementThe Board1. The Chairman The Chairman, The Rt Hon Lord Waldegrave of North Hill isshould be responsible for the leadership of the Board and for ensuringindependent. its effectiveness The Chairman continues to be independent of the AIFM and the Portfolio Manager. There is a clear division of responsibility between the Chairman, the Directors, the AIFM, the Portfolio Manager and the Company's other third party service providers. The Chairman is responsible for the leadership of the Board and for ensuring its effectiveness in all aspects of its role. There are no relationships that may create a conflict of interest between the Chairman's interests and those of Shareholders.2. A majority of Mr. Sven Borho is a Founding General Partner of OrbiMed, thethe Board should Company's Portfolio Manager and is not considered to be anbe independent Independent Director. Mr Borho submits himself for annualof the AIFM. re-election by shareholders. The Board consists of five other non-executive Directors, each of whom is independent of the AIFM and the Portfolio Manager. None of the Board members have been an employee of the Company.AIC Code Principle Compliance Statement3. Directors should be All Directors will submit themselves for annualsubmitted for re-election re-election by shareholders.at regular intervals.Nomination for re-electionshould not be assumed butbe based on disclosed The individual performance of each Directorprocedures and continued standing for re-election is evaluated annually bysatisfactory performance. the remaining members of the Board and, if considered appropriate, a recommendation is made that shareholders vote in favour of their re-election at the Company's Annual General Meeting to be held in July 2015. Mr Paul Gaunt will be retiring from the Board and will therefore, not be seeking re-election at this year's Annual General Meeting. The Board is currently in the process of recruiting a new director as part of its ongoing refreshment programme.4. The Board should have a The Board, meeting as the Nomination Committee,policy on tenure, which is considers the structure of the Board anddisclosed in the annual recognises the need for progressive refreshing ofreport. its members. The Board subscribes to the view expressed within the AIC Code that long-serving Directors should not be prevented from forming part of an independent majority. It does not consider that a Director's tenure necessarily reduces his or her ability to act independently and, following formal performance evaluations, believes that each of those Directors is independent in character and judgment and that there are no relationships or circumstances which are likely to affect their judgment. The Board's policy on tenure is that continuity and experience are considered to add significantly to the strength of the Board and, as such, no limit on the overall length of service of any of the Company's Directors, including the Chairman, has been imposed. In view of its non-executive nature, the Board considers that it is not appropriate for the Directors to be appointed for a specified term, although new Directors are appointed with the expectation that they will serve for a minimum period of three years subject to shareholder approval. The terms and conditions of the Directors' appointments are set out in letters of engagement which are available for inspection on request at the office of Frostrow, the Company's AIFM and from the Company Secretary at the Company's Annual General Meeting to be held in July 2015.AIC Code Principle Compliance Statement5. There should be full The Directors' biographical details demonstratedisclosure of information the wide range of skills and experience thatabout the Board. they bring to the Board together with details of their other directorships and employment. Details of the length of service of each Director are set out below: Length of Service as at 21 May 2015 The Rt Hon Lord Waldegrave of North Hill 16 years Sven Borho 9 years Professor Dame Kay Davies, DBE 3 years Paul Gaunt 17 years Andrew Joy 3 years Peter Keen 17 years Further details of Board composition and succession planning can be found within the Chairman's Statement. Details of the Board's Committees and their composition are set out within the Corporate Governance Section. The Audit and Management Engagement Committee membership comprises all of the Directors whom are considered independent. The Chairman of the Company is a member of the Audit and Management Engagement Committee, but does not chair it. His membership of the Audit and Management Engagement Committee is considered appropriate given the Chairman's extensive knowledge of the financial services industry. The Remuneration Committee is comprised of all Directors who are considered independent. The Senior Independent Director of the Company acts as Chairman of this Committee in light of the remit of the Committee. Please see principle 9 for further details concerning the Nomination Committee.6. The Board should aim to The Nomination Committee considers annually thehave a balance of skills, skills possessed by the Board and identifiesexperience, length of service any skill shortages to be filled by newand knowledge of the company. Directors. When considering new appointments, the Board reviews the skills of the Directors and seeks to add persons with complementary skills or who possess the skills and experience which fill any gaps in the Board's knowledge or experience and who can devote sufficient time to the Company to carry out their duties effectively. The experience of the current Directors is detailed in their biographies. The Company is committed to ensuring that any vacancies arising are filled by the most qualified candidates and recognises the value of diversity in the composition of the Board. When Board positions become available as a result of retirement or resignation, the Company will ensure that a diverse group of candidates is considered. Further details of Board composition and succession planning can be found within the Chairman's Statement.7. The Board should undertake During the year the performance of the Board,a formal and rigorous annual its committees and individual Directorsevaluation of its own (including each Director's independence) wasperformance and that of its evaluated through a formal assessment processcommittees and individual led by the Senior Independent Director. Thisdirectors. involved the circulation of a Board effectiveness checklist, tailored to suit the nature of the Company, followed by discussions between the Senior Independent Director and each of the Directors where necessary. The performance of the Chairman was evaluated by the other Directors under the leadership of the Senior Independent Director. The review concluded that the Board was working well. The Board is satisfied that the structure of skills, mix, experience, independence, knowledge, diversity and operation of the Board continue to be effective and relevant for the Company.8. Director remuneration The Remuneration Committee annually reviews theshould reflect their duties, fees paid to the Directors and compares theseresponsibilities and the with the fees paid by the Company's peer groupvalue of their time spent. and the investment trust industry generally, taking into account the level of commitment and responsibility of each Board member. Details on the remuneration arrangements for the Directors of the Company can be found in the Directors' Remuneration Policy Report and Directors' Remuneration Report and in note 15 to the Financial Statements. As all of Directors are non-executive, the Board considers that it is acceptable for the Senior Independent Director of the Company to chair meetings when discussing Directors' fees. The Senior Independent Director takes no part in discussions regarding his own remuneration.9. The independent directors The Nomination Committee is comprised of allshould take the lead in the directors who are independent and chaired byappointment of new directors the Chairman of the Board. Subject to thereand the process should be being no conflicts of interest, all members ofdisclosed in the annual the Committee are entitled to vote onreport. candidates for the appointment of new directors and on recommending for shareholders' approval the directors seeking re-election at the Annual General Meeting. The Chairman does not Chair the meeting when the committee is dealing with matters concerning the appointment of a successor to the Chairmanship. Details of the Board's commitment to diversity is set out within the Business Review.10. Directors should be New appointees to the Board are provided with aoffered relevant training and full induction programme. The programme coversinduction. the Company's investment strategy, policies and practices. The directors are also given key information on the Company's regulatory and statutory requirements as they arise including information on the role of the Board, matters reserved for its decision, the terms of reference for the Board Committees, the Company's corporate governance practices and procedures and the latest financial information. It is the Chairman's responsibility to ensure that the directors have sufficient knowledge to fulfil their role and directors are encouraged to participate in training courses where appropriate. The directors have access to the advice and services of a Company Secretary through its appointed representative which is responsible to the Board for ensuring that Board procedures are followed and that applicable rules and regulations are complied with. The Company Secretary is also responsible for ensuring good information flows between all parties.11. The Chairman (and the Principle 11 applies to the launch of newBoard) should be brought into investment companies and is therefore notthe process of structuring a applicable to the Company.new launch at an early stage.Board Meetings and relations with Frostrow and OrbiMed12. Boards and managers The Board meets regularly throughout the yearshould operate in a and a representative of the AIFM and Portfoliosupportive, co-operative and Manager is in attendance at each meeting andopen environment. Committee meetings. The Chairman encourages open debate to foster a supportive and co-operative approach for all participants.13. The primary focus at The Board has agreed a schedule of mattersregular Board meetings should specifically reserved for decision by thebe a review of investment Board. This includes establishing theperformance and associated investment objectives, strategy and benchmarks,matters, such as gearing, the level of borrowing, the permitted types orasset allocation, marketing/ categories of investments, the markets in whichinvestor relations, peer transactions may be undertaken, the amount orgroup information and proportion of the assets that may be investedindustry issues. in any category of investment or in any one investment, and the Company's share issuance, share buy-back and treasury share policies. The Board, at its regular meetings, undertakes reviews of key investment and financial data, revenue projections and expenses, analysis of asset allocation, transactions and performance comparisons, share price and net asset value performance, marketing and shareholder communication strategies, the risks associated with pursuing the investment strategy, peer group information and industry issues. The Chairman is responsible for ensuring that the Board receive accurate, timely and clear information. Where appropriate representatives of the AIFM report on issues effecting the company. All directors have access to independent professional advice where they judge it necessary to discharge their responsibility properly. The Audit and Management Engagement Committee reviews the Company's risk matrix and the performance and cost of the Company's third party service providers.14. Boards should give The Board is responsible for strategy and hassufficient attention to established an annual programme of agenda itemsoverall strategy. under which it reviews the objectives and strategy for the Company at each meeting.15. The Board should The Audit and Management Engagement Committeeregularly review both the reviews annually the performance of the AIFMperformance of, and and Portfolio Manager. The Committee considerscontractual arrangements the quality, cost and remuneration methodwith, the AIFM and the (including the performance fee) of the servicePortfolio manager (or provided by the AIFM and the Portfolio Managerexecutives of a self-managed against their contractual obligations and thecompany). Board receives monthly reports on compliance with the investment restrictions which it has set. It also considers the performance analysis provided by the AIFM and the Portfolio Manager. The Audit and Management Engagement Committee reviews the compliance and control systems of both the AIFM and the Portfolio Manager in operation insofar as they relate to the affairs of the Company and the Board undertakes periodic reviews of the arrangements with and the services provided by the Depositary, to ensure that the safeguarding of the Company's assets and security of the shareholders' investment is being maintained. Further details concerning the monitoring of the Company's internal controls and risk management can be found within the Strategic Report. All directors act in what they consider to be in the best interests of the company, consistent with their statutory duties set out in the Companies Act 2006.16. The Board should agree The Portfolio Management Agreement between thepolicies with the AIFM and Company, the AIFM and Portfolio Manager setsthe Portfolio Manager out the limits of Portfolio Manager'scovering key operational authority, beyond which Board approval isissues. required. The Board has also agreed detailed investment guidelines with the AIFM and the Portfolio Manager, which are considered at each Board meeting. A representative of the AIFM and Portfolio Manager attends each meeting of the Board to address questions on specific matters and to seek approval for specific transactions which the Portfolio Manager is required to refer to the Board. Frostrow in their capacity as the Company's AIFM have delegated the management of the portfolio and subsequent proxy voting to OrbiMed as Portfolio Manager, who retain the services of Broadridge and Glass Lewis to undertake operational and administrative duties relating to proxy voting. The Portfolio Manager notifies the Board of any contentious issues that require voting upon. The Board has reviewed the Portfolio Manager's Proxy Voting & Class Action Policy. Reports on commissions paid by the Portfolio Manager are submitted to the Board regularly.17. Boards should monitor the The Board considers any imbalances in thelevel of the share price supply of and the demand for the Company'sdiscount or premium (if any) shares in the market and takes appropriateand, if desirable, take action when considered necessary.action to reduce it. The Board considers the discount or premium to net asset value of the Company's share price at each Board meeting and reviews the changes in the level of discount or premium and in the share price since the previous Board meeting and over the previous twelve months. At each meeting the Board reviews reports from the AIFM on marketing and shareholder communication strategies. It also considers their effectiveness as well as measures of investor sentiment and any recommendations on issuance and share buy-backs. The Board does not consider that any conflicts arose from the AIFM and Portfolio Manager promoting the Company alongside their other clients.18. The Board should monitor The Audit and Management Engagement Committeeand evaluate other service reviews, at least annually, the performance ofproviders. all the Company's third party service providers, including the level and structure of fees payable and the length of the notice period, to ensure that they remain competitive and in the best interests of shareholders. The Committee also reviews reports from the principal service providers on compliance and the internal and financial control systems in operation and relevant independent audit reports thereon, as well as reviewing service providers' anti-bribery and corruption policies to address the provisions of the Bribery Act 2010. The Board is satisfied that the Company's Auditor does not carry out any work for the AIFM and therefore no potential conflict will arise.Shareholder Communications19. The Board should A detailed analysis of the substantialregularly monitor the shareholders of the Company is provided to theshareholder profile of the directors at each Board meeting.company and put in place a Representatives of the AIFM and the Portfoliosystem for canvassing Manager regularly meet with institutionalshareholder views and for shareholders and private client asset managerscommunicating the Board's to discuss strategy and to understand theirviews to shareholders. issues and concerns and, if applicable, to discuss corporate governance issues. The results of such meetings are reported at the following Board meeting. Regular reports from the Company's broker are submitted to the Board on investor sentiment and industry issues. Shareholders wishing to communicate with the Chairman, the Senior Independent Director or any other member of the Board, may do so by writing to the Company, for the attention of the Company Secretary at the offices of the AIFM. All shareholders are encouraged to attend the Annual General Meeting, where they are given the opportunity to question the Chairman, the Board and representatives of the Portfolio Manager. The Portfolio Manager will make a presentation to shareholders covering the investment performance and strategy of the Company at the forthcoming Annual General Meeting to be held in July 2015. The Directors welcome the views of all shareholders and place considerable importance on communications with them. The Chairman will ensure that all members of the Board are made aware of the issues and concerns raised by shareholders and that the appropriate steps are taken so that the Board has an adequate understanding of these views, through communication with the Company's AIFM and advisors.20. The Board should normally All substantive communications regarding anytake responsibility for, and major corporate issues are discussed by thehave a direct involvement in, Board taking into account representations fromthe content of communications the AIFM, the Portfolio Manager, the Auditor,regarding major corporate legal advisers and stockbroker.issues even if the manager isasked to act as spokesman.21. The Board should ensure The Company places great importance onthat shareholders are communication with shareholders and aims toprovided with sufficient provide them with a full understanding of theinformation for them to Company's investment objective, policy andunderstand the risk:reward activities, its performance and the principalbalance to which they are investment risks by means of informative annualexposed by holding the and half-year reports. This is supplemented byshares. the daily publication, through the London Stock Exchange, of the net asset value per share of the Company's shares. The Board is responsible for the overall management of the Company, approval of the Company's long term objectives and commercial strategy and the review of the Company's Investment Policy. The Board continues to review the setting of maximum borrowing limits under which the AIFM and Portfolio Manager operates within. The annual report provides information on Portfolio Manager's investment performance, portfolio risk and operational and compliance issues. Further details on the risk/reward balance are set out in note 13 to the Financial Statements. The Board reviews the Portfolio Manager's investment performance, portfolio risk and operational issues on a quarterly basis. A Compliance Report is circulated by the AIFM for review on a monthly basis. The Investment Portfolio is listed within the Strategic Report. The Company's website, www.biotechgt.com, is regularly updated with monthly factsheets and provides useful information about the Company including the Company's financial reports and announcements.Governance / Corporate GovernanceBoard Independence, Composition and TenureThe Board is responsible to shareholders for the overall management of theCompany's affairs and currently consists of six non-executive Directors. TheChairman is responsible for the leadership of the Board and ensuring itseffectiveness in all aspects of its role. The Directors' biographical detailsdemonstrate a breadth of investment, commercial and professional experience. MrAndrew Joy is the Senior Independent Director, who can act as a sounding boardfor the Chairman and as an intermediary for the other Directors if necessary.The Company's Articles of Association provide that all Directors are requiredto submit themselves for re-election at least once every three years orannually if they have served for more than eight years. While the Company isnot a FTSE 350 company the Board has implemented the provisions of the UKGovernance Code whereby all Directors of the Company stand for re-election onan annual basis.All of the Directors, with the exception of Mr Sven Borho, are consideredindependent of the AIFM and the Portfolio Manager and have no relationship orconflicts which are likely to affect their independent judgment. The Boardsubscribes to the view expressed within the AIC Code that long-servingDirectors should not be prevented from forming part of an independent majorityand it does not consider that a Director's tenure necessarily reduces his orher ability to act independently.The Board has considered the position of all of the Directors as part of theevaluation process, and believes that it would be in the Company's bestinterests to propose them, with the exception of Mr Paul Gaunt who is retiringat the conclusion of the forthcoming Annual General Meeting for re-election atthe forthcoming Annual General Meeting for the following reasons:The Rt Hon Lord Waldegrave, who has been Chairman of the Company since July2012 and a Director since 1998, brings a wealth of experience to the Boardthrough his financial career. He formally held a number of cabinet postsincluding Secretary of State for Health. He is Provost of Eton College,Chairman of Coutts and Co Limited and of the Royal Mint Advisory Committee.Professor Dame Kay Davies, DBE, who has been a Director since March 2012, hasextensive knowledge of the biopharmaceutical sector and is the Dr Lee'sProfessor of Anatomy and Associate Head of the Medical Science Division at theUniversity of Oxford. She is also a consultant to drug discovery company Summitplc.Mr Andrew Joy, who has been a Director since March 2012 is Senior IndependentDirector and Chairman of the Remuneration Committee. He has extensive knowledgeof the financial sector and was one of the founding Partners of Cinven where hecontinues as a Senior Advisor. He has been Chairman or Director of numerousgrowing companies over the past 30 years.Mr Sven Borho, who has been a Director since March 2006 is one of the foundingpartners of OrbiMed the Company's Portfolio Manager. He heads public equity andhedge funds and has played an integral role in the growth of OrbiMed's assetmanagement activities.Mr Peter Keen, who has been a Director since June 1997 and is Chairman of theAudit and Management Engagement Committee. A Chartered Accountant he has nearly30 years experience in the management and financing of life science businesses;his contribution to the Company's Audit and Management Engagement Committee isparticularly respected by his colleagues.The Chairman is pleased to report that following a formal performanceevaluation, the Directors' performance continues to be effective and theycontinue to demonstrate commitment to the role.The Board's ResponsibilitiesThe Board meets regularly and four Board meetings were held during the year todeal with the stewardship of the Company and other matters. There is a formalschedule of matters specifically reserved for decision by the Board; it isresponsible for all aspects of the Company's affairs, including the setting ofparameters for and the monitoring of the investment strategy and the review ofinvestment performance and investment policy. It also has responsibility forall corporate strategy issues, dividend policy, share buy-back and issuancepolicy, borrowing, share price and discount/premium monitoring and corporategovernance matters.There is an agreed procedure for Directors, in the furtherance of their duties,to take independent professional advice if necessary at the Company's expense.The Directors have access to the advice and services of the Company Secretary,through its appointed representative, who is responsible to the Board forensuring that Board procedures are followed.Conflicts of InterestDirectors have a duty to avoid a situation in which he or she has, or can have,a direct or indirect interest that conflicts, or possibly may conflict, withthe Company's interests (a "situational conflict").It is the responsibility of each individual Director to avoid an unauthorisedconflict situation arising. He or she must request authorisation from the Boardas soon as he or she becomes aware of the possibility of a situational conflictarising.The Board is responsible for considering Directors' requests for authorisationof situational conflicts and for deciding whether they should be authorised.The factors to be considered will include whether the situational conflictcould prevent the Director from performing his or her duties, whether it has,or could have, any impact on the Company and whether it could be regarded aslikely to affect the judgment and/or actions of the Director in question. Whenthe Board is deciding whether to authorise a conflict or potential conflict,only Directors who have no interest in the matter being considered are able totake the relevant decision, and in taking the decision the Directors must actin a way they consider, in good faith, will be most likely to promote theCompany's success. The Directors are able to impose limits or conditions whengiving authorisation if they think this is appropriate in the circumstances.A register of conflicts is maintained by the Company Secretary and is reviewedat each Board meeting, to ensure that any authorised conflicts remainappropriate. Directors are required to confirm at these meetings whether therehas been any change to their position.The Directors must also comply with the statutory rules requiring companydirectors to declare any interest in an actual or proposed transaction orarrangement with the Company.Committees of the BoardThe Board has delegated certain responsibilities and functions to committees.Copies of the full terms of reference, which clearly define theresponsibilities of each committee, can be obtained from the Company Secretary,will be available for inspection at the Annual General Meeting and can be foundat the Company's website at www.biotechgt.com. The membership of the Company'scommittees comprises those Directors considered independent by the Board. TheRemuneration Committee is chaired by Mr Andrew Joy, the Nominations Committeeis chaired by the Chairman of the Company, The Rt Hon Lord Waldegrave of NorthHill, and the Audit and Management Engagement Committee is chaired by Mr PeterKeen.Nominations CommitteeThe Nominations Committee met on one occasion during the year and isresponsible for the Board appraisal process and for making recommendations tothe Board on the appointment of new Directors. Where appropriate, each Directoris invited to submit nominations and external advisers are used to identifypotential candidates.Remuneration CommitteeThe Company's Remuneration Committee met on one occasion during the year. Thelevel of Directors' fees is reviewed each year relative to other comparableinvestment companies and in the light of Directors' responsibilities.Consistent with this policy as at 1 April 2015, the Directors' fees remainunchanged. Details of the fees paid to the Directors in the year under revieware detailed in the Directors' Remuneration Report and also the Directors'Remuneration Policy Report.Audit and Management Engagement CommitteeThe Audit and Management Engagement Committee (the "Committee") meets at leastthree times a year and is responsible for the review of the half-year andannual financial statements, the nature and scope of the external audit and thefindings therefrom and the terms of appointment of the Auditors, includingtheir remuneration and the provision of any non-audit services by them. Inaddition, the Committee is responsible for the review of the Company'sfinancial controls and of the AIFM and Portfolio Management Agreements and ofthe services provided by the AIFM and the Portfolio Manager. At a Committeemeeting held on 11 February 2015 it was agreed that no amendments to theagreements were required. The agreements were entered into as part of theimplementation of AIFMD in July 2014 and will be reviewed annually.The Committee meets representatives of the AIFM and Portfolio Manager and theirCompliance Officers who report as to the proper conduct of business inaccordance with the regulatory environment in which the Company, AIFM andPortfolio Manager operate. The Company's Auditors also attend meetings of thisCommittee at its request and report on their work procedures and their findingsin relation to the Company's statutory audit. They also have the opportunity tomeet with the Committee without representatives of the AIFM or the PortfolioManager being present.Internal AuditThe Audit and Management Engagement Committee carries out an annual review ofthe need for an internal audit function. As the Company delegates to thirdparties its day-to-day operations and has no employees, it has determined thatthere are no requirements for an internal audit function.The Board applies the same standards to its service providers in theiractivities for the Company.Anti-Bribery and Corruption PolicyA copy of the Company's anti-bribery and corruption policy can be found on itswebsite at www.biotechgt.com. The policy is reviewed regularly by the Audit andManagement Engagement Committee.Relationship with ShareholdersThe Board, the AIFM and the Portfolio Manager consider maintaining goodcommunications with shareholders and engaging with larger shareholders throughmeetings and presentations a key priority. Shareholders are being informed bythe publication of annual and half year reports which include financialstatements. These reports are supplemented by the daily release of the netasset value per share to the London Stock Exchange and the publication ofmonthly factsheets. All this information including interviews with thePortfolio Manager is available on the Company's website at www.biotechgt.com.The Board is also keen that the Annual General Meeting ("AGM") be aparticipative event for all shareholders. The Portfolio Manager makes apresentation and shareholders are encouraged to attend. The Chairmen of theBoard and of the Committees attend the AGM and are available to respond toqueries and concerns from shareholders. Twenty working days notice of the AGMhas been given to shareholders and separate resolutions are proposed inrelation to each substantive issue. Shareholders may submit questions for theAGM in advance of the meeting or make general enquiries of the Company via theCompany Secretary at the registered office of the Company. The Directors makethemselves available after the AGM to meet shareholders.Where the vote is decided on a show of hands, the proxy votes received arerelayed to the meeting and subsequently published on the Company's website.Proxy forms have a 'vote withheld' option. The Notice of Meeting sets out thebusiness of the AGM together with the full text of any special resolutions.The Company has made arrangements for investors through the Alliance SavingsScheme to receive all Company communications and have the ability to direct thecasting of their votes. The Company has also made arrangements with itsregistrar for shareholders, who own their shares direct rather than through anominee or share scheme, to view their account via the internet atwww.capitashareportal.com. Other services are also available via this service.The Board monitors the share register of the Company; it also reviewscorrespondence from shareholders at each meeting and maintains regular contactwith major shareholders. Shareholders who wish to raise matters with a Directormay do so by writing to them at the registered office of the Company.The Board receives marketing and public relations reports from the AIFM towhich the marketing financial has been delegated. The Board reviews andconsiders the marketing plans of the AIFM on a regular basis.Exercise of Voting PowersThe Board has delegated authority to the Portfolio Manager to vote the sharesowned by the Company that are held on its behalf by its Depositary, J.P. MorganEurope Limited. The Board has instructed that the Portfolio Manager submitvotes for such shares wherever possible. This accords with current bestpractice whilst maintaining a primary focus on financial returns. The PortfolioManager may refer to the Board on any matters of a contentious nature. TheCompany does not retain voting rights on any shares that are subject torehypothecation in connection with the overdraft facility provided byJ.P. Morgan Clearing Corp.Nominee Share CodeWhere shares are held in a nominee company name and where the beneficial ownerof the shares is unable to vote in person, the Company nevertheless undertakes:to provide the nominee company with multiple copies of shareholdercommunications, so long as an indication of quantities has been provided inadvance;to allow investors holding shares through a nominee company to attend generalmeetings, provided the correct authority from the nominee company is available;andthat investors in the Alliance Trust Savings Scheme or ISA are automaticallysent shareholder communications, including details of general meetings,together with a form of direction to facilitate voting and to seek authority toattend.Nominee companies are encouraged to provide the necessary authority tounderlying shareholders to attend the Company's general meetings.By order of the BoardFrostrow Capital LLPCompany Secretary21 May 2015Governance / Audit and Management Engagement Committee Reportfor the year ended 31 March 2015The Committee, which comprises of all the Directors, with the exception of Mr.Sven Borho, meets at least twice during the year.ResponsibilitiesThe Committee's main responsibilities during the year were:To review the Company's half year and annual financial statements together withannouncements and other filings relating to the financial performance of theCompany and issues of the Company's shares. In particular, the Committeeconsidered whether the annual financial statements are fair, balanced andunderstandable, allowing shareholders to more easily assess the Company'sstrategy, investment policy, business model and financial performance.To review the risk management and internal control processes of the Company andits key service providers. As part of this review the Committee again reviewedthe appropriateness of the Company's anti-bribery and corruption policy. Duringthe year the Committee reviewed the Internal Controls in place at the Company'sAIFM, Frostrow, its Portfolio Manager, OrbiMed, its Registrar, Capita AssetServices and its Depositary J.P. Morgan Europe Limited.To recommend the appointment of an external auditor,and agreeing the scope ofits work and its remuneration, reviewing its independence and the effectivenessand objectivity of the audit process.To consider any non-audit work to be carried out by the auditors. The Committeereviews the need for non-audit services and authorises such fees on a case bycase basis, having consideration to the cost effectiveness of the services andthe independence and objectivity of the Auditors. Non audit fees of £6,000 werepaid to Ernst & Young LLP for their review of the Company's half-year accounts.In addition fees totaling £3,000 were earned in relation to taxation services.The external auditor carried out no other non-audit work during the year.To consider the need for an internal audit function.Since the Company delegatesits day-to-day operations to third parties and has no employees, the Committeehas determined there is no requirement for such a function.The Committee's terms of reference are available for review on the Company'swebsite at www.biotechgt.com.Meetings and BusinessThe Committee which consists of all the independent Directors of the Company,met three times during the year. A Sub Committee consisting of Mr Peter Keenand Dr John Gordon met a number of times during this period in order to conductthe audit tender and make formal recommendations to the Board.The following matters were dealt with at these meetings:May 2014Review of the Committee's terms of referenceReview of the preliminary resultsApproval of the annual report and financial statementsReview of risk management, internal controls and complianceReview of the Manager's internal control frameworkNovember 2014Review of the auditor's plan for the 2014/2015 auditReview of the Committee's terms of referenceReview of risks, internal control and complianceReview of the Company's anti bribery and corruption policy and the measures putin place by the Company's service providersApproval of the half-year reportFebruary 2015Review of the Committee's terms of referenceA review of the Company's service providersFinancial StatementsThe financial statements, and the annual report as a whole, are theresponsibility of the Board. The Board looks to the Audit and ManagementEngagement Committee to advise them in relation to the Financial Statementsboth as regards their form and content, issues which might arise and on anyspecific areas requiring judgment.Significant Reporting MattersDuring the year the Committee considered key accounting issues, matters andjudgments in relation to the Company's financial statements and disclosuresrelating to:Company's InvestmentsThe Committee approached and dealt with this area of risk by:reconfirming its understanding of the processes in place to record investmenttransactions and to value the investment portfolio;gaining an overall understanding of the performance of the investment portfolioboth in capital and revenue terms through comparison to a suitable benchmark;andensuring that all investment holdings and cash/deposit balances have beenagreed to confirmation from the custodian or relevant bank.Performance FeeThe Committee approached and dealt with the area of risk by:Seeking confirmation from the AIFM that the performance fee is calculated inaccordance with the Alternative Investment Fund Manager agreement and thePortfolio Management agreement. (Further details can be found in the Report ofDirectors).Seeking confirmation from the Company's auditor that the fees accrued andpayable are in accordance with the above mentioned agreements. As part of theaudit process all inputs are agreed to audited source data and the performancefee is re–calculated.Prior to the payment of any performance fees, the Company's auditor is engagedto audit the amounts payable which includes a re-calculation of the feespayable.TaxationThe Committee approached and dealt with the area of risk, surroundingcompliance with section 1158 of the Corporation Tax Act 2010, by:seeking confirmation from the AIFM that the Company continues to meet theeligibility conditions as outlined in section 1158;by obtaining written confirmation from HMRC, evidencing the approval of theCompany as an investment trust under the regime; andunderstanding the risks and consequences if the Company breaches this approvalin future years.Internal ControlsIn accordance with the provision C2 and C3 of the UK Corporate Governance Code,risk assessment and the review of internal controls are undertaken by the Boardin the context of the Company's overall investment objective. The review coversthe key business, operational, compliance and financial risks facing theCompany. In arriving at its judgment of what risks the Company faces, the Boardhas considered the Company's operations in the light of the factors listedoverleaf:the nature and extent of risks which it regards as acceptable for the Companyto bear within its overall business objective;the threat of such risks becoming a reality; andthe Company's ability to reduce the incidence and impact of risk on itsperformance.Against this background, the Board has split the review of risk and associatedcontrols into five sections reflecting the nature of the risks being addressed.These sections are as follows:corporate strategy;investment activity;published information, compliance with laws and regulations;service providers; andfinancial activity.The Company has appointed Frostrow to provide administrative services to theCompany. The Company has obtained from its various service providers assurancesand information relating to their internal systems and controls to enable theBoard to make an appropriate risk and control assessment, including thefollowing:details of the control environment in operation;identification and evaluation of risks and control objectives;review of communication methods and procedures; andassessment of the control procedures.The key procedures which have been established to provide internal financialcontrols are as follows:portfolio management is provided by OrbiMed who provide regular updates andreports to the Board. The Board is responsible for setting the overallinvestment policy and monitors the actions of the Portfolio Manager at regularBoard meetings;administration, company secretarial and marketing duties for the Company areperformed by Frostrow;custody of assets is undertaken by J.P. Morgan Europe Limited;the Board clearly defines the duties and responsibilities of their agents andadvisers. The appointment of agents and advisers to the Company is conducted bythe Board after consideration of the quality of the parties involved; the Boardmonitors their ongoing performance and contractual arrangements;mandates for authorisation of investment transactions and expense payments areset by the Board; andthe Board reviews financial information produced by the AIFM and the PortfolioManager in detail on a regular basis.All of the Company's management functions are performed by third parties whoseinternal controls are reviewed by the Board or on its behalf by Frostrow.In accordance with guidance issued to directors of listed companies, theDirectors confirm that they have carried out a review of the effectiveness ofthe system of internal financial control and risk management during the year,as set out above and that:The Board has in place an ongoing procedure for identifying, evaluating andmanaging significant risks faced by the Company, which were in place for theyear under review and up to 21 May 2015. This procedure is regularly reviewedby the Board and accords with the Turnbull guidance and Listing Rule 9.8; andAs mentioned above the Board are responsible for the Company's system ofinternal controls and for reviewing its effectiveness and that it is designedto manage the risk of failure to achieve business objectives. This can onlyprovide reasonable not absolute assurance against material misstatement orloss.External AuditorMeetings:This year the nature and scope of the audit together with Ernst & Young LLP'saudit plan were considered by the Committee on 4 November 2014 without theauditor being present:As Chairman of the Committee, I met the audit partner, Mr Amarjit Singh, andhis audit manager on 28 April 2015 to discuss the outcome of the audit and thedraft 2015 annual report and accounts. The Committee then met Ernst & Young LLPon 14 May 2015 to review the progress of the audit and to discuss the limitedmatters that arose.Independence and Effectiveness:In order to fulfil the Committee's responsibility regarding the independence ofthe Auditor, we reviewed:the senior audit personnel in the audit plan for the year,the auditor's arrangements concerning any conflicts of interest,the extent of any non-audit services,the statement by the auditor that they remain independent within the meaning ofthe regulations and their professional standards; andauditor independence and length of tenure of the audit partner.In order to consider the effectiveness of the audit process, we reviewed:the auditor's fulfilment of the agreed audit plan,the report arising from the audit itself, andfeedback from the AIFM.The Committee is satisfied with the auditor's independence and theeffectiveness of the audit process, together with the degree of diligence andprofessional scepticism brought to bear.AuditorsIt had been noted by the Committee that the Company's previous Auditor, GrantThornton UK LLP and its predecessor firm, had been in office since theCompany's inception, during which time no audit tender had taken place. Whilstthe audit partner had changed periodically in accordance with professional andregulatory standards to protect independence and objectivity, in accordancewith best practice it was felt appropriate to undertake a formal audit tender.Following a formal tender process, Ernst & Young LLP were appointed as Auditorof the Company commencing with the 2014/15 financial year. In accordance withthe recommendations of the Statutory Audit Services for Large Companies MarketInvestigation Order 2014 the Company will review the need to re-tender for newauditors every 10 years.Grant Thornton UK LLP resigned with effect from the conclusion of the AnnualGeneral Meeting held on 10 July 2014. Having satisfied themselves of theappropriateness of Ernst & Young LLP following the tender process and inaccordance with the Companies Act 2006, shareholder approval concerning theappointment of a new Auditor and the authority to fix their remuneration wasgranted at the Annual General Meeting held on 10 July 2014.Ernst & Young LLP has carried out the audit for the year ended 31 March 2015and were considered to be independent by the Board.Ernst & Young LLP have indicated their willingness to continue to act asAuditor to the Company for the forthcoming year and a resolution for theirre-appointment will be proposed at the forthcoming Annual General Meeting. Length of serviceAuditor Date of Appointment as at 21 May 2015Ernst & Young LLP 10 July 2014 10 monthsPeter KeenChairman of the Audit and Management Engagement Committee21 May 2015Governance / Directors' Remuneration Reportfor the year ended 31 March 2015Statement from the ChairmanI am pleased to present the Directors' Remuneration Report to shareholders.This report has been prepared in accordance with the requirements of Section421 of the Companies Act 2006 and the Enterprise and Regulatory Reform Act2013. An Ordinary Resolution for the approval of this report was last put tothe shareholders at the 2014 Annual General Meeting.The law requires the Company's Auditor to audit certain of the disclosuresprovided in this report. Where disclosures have been audited, they areindicated as such and the Auditor's opinion is included in their report toshareholders. The Remuneration Policy Report forms part of this report.The Remuneration Committee considers the framework for the remuneration of theDirectors on an annual basis. It reviews the ongoing appropriateness of theCompany's remuneration policy and the individual remuneration of Directors byreference to the activities of the Company and comparison with other companiesof a similar structure and size. This is in line with the AIC Code.At the most recent review held on 11 February 2015, it was agreed to increasethe fees paid to the Directors by c.4% with effect from 1 April 2015 (the lastincrease having taken effect from 1 April 2013): Chairman £35,500, Chairman ofthe Audit Committee and Senior Independent Director £27,000 and £25,000 foreach other Director.In the year to 31 March 2015, the Directors' fees were paid at the followingannual rates: myself as Chairman of the Company £34,000, Mr Peter Keen asChairman of the Audit and Management Engagement Committee and Mr Joy as SeniorIndependent Director received an annual fee of £26,000 and £24,000 for eachother Director.All levels of remuneration reflect both the time commitment and responsibilityof the role.Directors' FeesThe Directors, as at the date of this report, and who all served throughout theyear, received the fees listed in the table below. These exclude any employers'national insurance contributions, if applicable. No other forms of remunerationwere received by the Directors and so fees represent the total remuneration ofeach Director.As noted in the Strategic Report, all of the Directors are non-executive andtherefore there is no Chief Executive Officer. The Company does not have anyemployees. There is therefore no CEO or employee information to disclose.£7,300 was paid to Dr John Gordon, a former director of the Company who retiredfrom the Board on Thursday, 10 July 2014.Directors' Emoluments for the Year (audited)The Directors who served in the year received the following emoluments in theform of fees: Date of Appointment Fees Fees to the Board 2015 2014The Rt Hon Lord Waldegrave of North Hill*(Chairman) 6 June 1998 34,000 34,000Sven Borho 23 March 2006 24,000 24,000Professor Dame Kay Davies, DBE 15 March 2012 24,000 24,000Paul Gaunt 5 June 1997 24,000 24,000Dr John Gordon** 5 June 1997 7,300 26,000Andrew Joy (Senior Independent Director &Chairman of theRemuneration Committee)*** 15 March 2012 25,449 24,000Peter Keen (Chairman of the Audit & ManagementEngagement Committee) 23 June 1997 26,000 26,000 164,749 182,000* appointed as Chairman of the Company on 12 July 2012.** Dr Gordon retired from the Board on 10 July 2014.*** appointed as Senior Independent Director and Chairman of the RemunerationCommittee on 10 July 2014.At the Annual General Meeting held in July 2014 the results in respect of theresolutions to approve the Directors' Remuneration Report and Policy were asfollows:Directors' Remuneration Report Percentage of Percentage of Number of votes cast votes cast votes For Against withheld 98.94 1.06 5,130Directors' Remuneration Policy Percentage of Percentage of Number of votes cast votes cast votes For Against withheld 77.15 22.85 68,430Further details concerning Director Remuneration can be found in the CorporateGovernance section.A copy of the Directors' Remuneration Policy may be inspected by shareholdersby either contacting the Company Secretary or visiting the Company's website atwww.biogtechgt.com.Sums paid to Third PartiesNone of the fees referred to in the above table were paid to any third party inrespect of the services provided by any of the Directors.Other BenefitsTaxable Benefits - Article 88 of the Company's Articles of Association providesthat Directors are entitled to be reimbursed for reasonable expenses incurredby them in connection with the performance of their duties and attendance atBoard and General Meetings.The following expenses were paid to Directors during the year. 31 March 2015The Rt Hon Lord Waldegrave of North Hill (Chairman) £nilSven Borho† £16,276Professor Dame Kay Davies, DBE £91Paul Gaunt £1,426Dr John Gordon* £nilAndrew Joy £nilPeter Keen £421† paid to OrbiMed Capital LLC in respect of travel expenses.* Dr Gordon retired from the Board on 10 July 2014.Pensions related benefits - Article 90 permits the Company to provide pensionor similar benefits for Directors and employees of the Company. However, nopension schemes or other similar arrangements have been established and noDirector is entitled to any pension or similar benefits.Loss of officeDirectors do not have service contracts with the Company but are engaged underLetters of Appointment. These specifically exclude any entitlement tocompensation upon leaving office for whatever reason.Share Price ReturnShare price versus the NASDAQ Biotechnology Index (sterling adjusted). Thechart below illustrates the shareholder return for a holding in the Company'sshares as compared to the NASDAQ Biotechnology Index (sterling adjusted), whichthe Board has adopted as the measure for both the Company's performance andthat of the Portfolio Manager for the PERIODRelative Cost of Directors' Remuneration for the year ended 31 March 2015 2015 2014 DifferenceSpend £000 £000 £000Fees of non-executive directors 165 182 (17)AIFM and Portfolio management fees and other expenses 6,604 3,632 2,972Share buy-backs* 22,043 3,420 18,623* Share buy-back activity forms part of the Board's active discount managementpolicy.The above table does not reflect the issuance of shares from treasury duringthe year ended 31 March 2015.Directors' Interests in Ordinary Shares (audited*)The Directors interests in the share capital of the Company are shown in thetable below: Number of shares held as at 21 May 31 March 31 March 2015 2015* 2014*The Rt Hon Lord Waldegrave of North Hill (Chairman) 58,716 58,716 58,716Sven Borho 221,218 221,218 236,218Professor Dame Kay Davies, DBE - - -Paul Gaunt - - -Dr John Gordon n/a n/a 70,000Andrew Joy 25,000 25,000 25,000Peter Keen 55,000 55,000 45,000None of the Directors was granted or exercised rights over shares during theyear. Sven Borho is a Partner at OrbiMed, the Company's Portfolio Manager,which is party to the Portfolio Management Agreement with the Company andreceives fees.The partners and employees of the AIFM had interests in a total of 51,652shares of the Company as at 31 March 2015.The partners and employees of the Portfolio Manager had interests in a total of446,313 shares of the Company as at 31 March 2015.As at 21 May 2015, the latest practicable date before publication of the AnnualReport there have been no changes in the interests of the Directors shares ofthe Company.There are no provisions included within the Company's Articles of Associationwhich require Directors to hold qualifying shares in the Company.Annual StatementOn behalf of the Board I confirm that this Remuneration Policy and RemunerationReport summarises, as applicable, for the year to 31 March 2015:the major decisions on Directors' remuneration;any substantial changes relating to Directors' remuneration made during theyear; andthe context in which the changes occurred and decisions have been taken.The Rt Hon Lord Waldegrave of North HillChairman21 May 2015Governance / Directors' Remuneration Policyfor the year ended 31 March 2015The Company follows the recommendations of the AIC Code that Directors'remuneration should reflect their duties, responsibilities and the value oftheir time spent. The Board's policy is that the remuneration of the Directorsshould reflect the experience of the Board as a whole, and is determined withreference to comparable organisations and appointments. There are noperformance conditions attaching to the remuneration of the Directors as theBoard does not believe that this is appropriate for non-executive Directors.This policy is reviewed annually and it is intended that it will continue forthe year ending 31 March 2016 and for subsequent financial years.The fees for the Directors are determined within the limits set out in theCompany's Articles of Association, the maximum aggregate limit currently being£250,000 per annum, and they are not eligible for bonuses, pension benefits,share options, long-term incentive schemes or other benefits. The current andprojected Directors' fees are shown in the following table. The Company doesnot have any employees.Directors' Fees Current and Projected Date of Year to Year to 31 31 Appointment March March to the Board 2016 2015 6 JuneThe Rt Hon Lord Waldegrave of North Hill* (Chairman) 1998 35,500 34,000 23 MarchSven Borho 2006 25,000 24,000 15 MarchProfessor Dame Kay Davies, DBE 2012 25,000 24,000 5 JunePaul Gaunt** 1997 6,827 24,000 5 JuneDr John Gordon*** 1997 - 7,300Andrew Joy (Senior Independent Director and Chairmanof the 15 MarchRemuneration Committee) 2012 27,000 25,449Peter Keen (Chairman of the Audit & Management 23 JuneEngagement Committee) 1997 27,000 26,000 146,327 164,749* appointed as Chairman of the Company on 12 July 2012.** 2016 fees have been adjusted to account for Mr Gaunt's forthcomingretirement from the Board on 8 July 2015.*** Dr Gordon retired from the Board on 10 July 2014.No change is expected to the current level of Directors' fees until at leastFebruary 2016. Any new director being appointed to the Board that has not beenappointed as either Chairman of a Committee or as the Senior IndependentDirector will under the current level of fees receive £25,000 per annum.Directors' Remuneration year ended 31 March 2015None of the Directors has a service contract. The terms of their appointmentprovide that Directors shall retire and be subject to election at the firstannual general meeting after their appointment and to re-election annuallythereafter. The terms also provide that a Director may be removed withoutnotice and that compensation will not be due on leaving office.No communications have been received from shareholders regarding Directors'remuneration.In accordance with best practice recommendations the Board will put theRemuneration Policy to shareholders at the annual general meeting at least onceevery three years.Approval of this policy was granted by Shareholders at the Annual GeneralMeeting held in July 2014.Financial Statements / Income Statementfor the year ended 31 March 2015 2015 2014 Revenue Capital Total Revenue Capital Total Notes £'000 £'000 £'000 £'000 £'000 £'000InvestmentIncomeInvestmentincome 2 988 - 988 873 - 873Totalincome 988 - 988 873 - 873Gains oninvestmentsGains oninvestmentsheld atfair valuethroughprofit orloss 8 - 225,023 225,023 - 87,614 87,614Exchange(losses)/gains oncurrencybalances - (4,858 ) (4,858 ) - 1,670 1,670ExpensesAIFM,Portfoliomanagementandperformancefees 3 - (5,869 ) (5,869 ) - (2,763 ) (2,763 )Otherexpenses 4 (735 ) - (735 ) (869 ) - (869 )Profitbeforefinancecosts andtaxation 253 214,296 214,549 4 86,521 86,525Financecosts 5 - (157 ) (157 ) - (94 ) (94 )Profitbeforetaxation 253 214,139 214,392 4 86,427 86,431Taxation 6 (132 ) - (132 ) (94 ) - (94 )Profit/(loss) forthe year 121 214,139 214,260 (90 ) 86,427 86,337Basic anddilutedearnings/(loss) pershare 7 0.2 p 327.8p 328.0p (0.1p ) 126.9p 126.8pThe Company does not have any income or expenses which are not included in theprofit for the year. Accordingly the "profit for the year" is also the "totalcomprehensive income for the year", as defined in IAS 1 (revised) and noseparate Statement of Comprehensive Income has been presented.All of the profit and total comprehensive income for the year is attributableto the owners of the Company.The "Total" column of this statement represents the Company's Income Statement,prepared in accordance with International Financial Reporting Standards (IFRS)as adopted by the EU. The "Revenue" and "Capital" columns are supplementary tothis and are prepared under guidance published by the Association of InvestmentCompanies.The accompanying notes are an integral part of this statement.Financial Statements / Statement of Financial Positionas at 31 March 2015 2015 2014 Notes £'000 £'000Non current assetsInvestments held at fair value through profit orloss 8 583,209 368,362Current assetsOther receivables 9 3,325 12,072 3,325 12,072Total assets 586,534 380,434Current liabilitiesOther payables 10 53,232 40,186 53,232 40,186Net assets 533,302 340,248Equity attributable to equity holdersOrdinary share capital 11 17,222 17,222Share premium account 43,021 42,732Special reserve 252 21,747Capital redemption reserve 5,577 5,577Capital reserve 16 470,907 256,768Revenue reserve (3,677 ) (3,798 )Total equity 533,302 340,248Net asset value per share 12 834.7p 498.7pThe financial statements were approved by the Board on 21 May 2015 and weresigned on its behalf by:The Rt Hon Lord Waldegrave of North HillChairmanThe accompanying notes are an integral part of this statement.The Biotech Growth Trust PLC - Company Registration Number 3376377 (Registeredin England)Financial Statements / Statement of Changes in Equityfor the year ended 31 March 2015 Ordinary Share Capital share premium Special redemption Capital Revenue capital account reserve reserve reserve reserve Total £'000 £'000 £'000 £'000 £'000 £'000 £'000At 31March 2014 17,222 42,732 21,747 5,577 256,768 (3,798 ) 340,248Net profitfor theyear - - - - 214,139 121 214,260Repurchaseof ownshares tobe held intreasury - - (22,043 ) - - - (22,043 )Sharesissuedfromtreasury - 289 548 - - - 837At 31March 2015 17,222 43,021 252 5,577 470,907 (3,677 ) 533,302for theyear ended31 March2014 Ordinary Share Capital share premium Special redemption Capital Revenue capital account reserve reserve reserve reserve Total £'000 £'000 £'000 £'000 £'000 £'000 £'000At 31March 2013 16,117 26,122 25,167 5,577 170,341 (3,708 ) 239,616Net profit/(loss)for theyear - - - - 86,427 (90 ) 86,337Issue ofnew shares 1,105 16,610 - - - - 17,715Repurchaseof ownshares tobe held intreasury - - (3,420 ) - - - (3,420 )At 31March 2014 17,222 42,732 21,747 5,577 256,768 (3,798 ) 340,248The accompanying notes are an integral part of this statement.Financial Statements / Statement of Cash Flowsfor the year ended 31 March 2015 2015 2014 £'000 £'000Operating activitiesProfit before tax 214,392 86,431Add back interest paid 157 94Less: gain on investments held at fair value throughprofit or loss (225,023 ) (87,614 )Purchases of investments held at fair value throughprofit or loss (358,924 ) (317,854 )Sales of investments held at fair value through profitor loss 368,863 271,667Decrease/(increase) in other receivables 139 (162 )Increase/(decrease) in other payables 1,388 (2,950 )Net cash inflow/(outflow) from operating activitiesbefore interest and taxation 992 (50,388 )Interest paid (157 ) (94 )Taxation paid (132 ) (94 )Net cash inflow/(outflow) from operating activities 703 (50,576 )Financing activitiesProceeds from sale of treasury shares 837 17,715Repurchase of own shares to be held in treasury (22,043 ) (3,420 )Net cash inflow from financing (21,206 ) 14,295Decrease in cash and cash equivalents (20,503 ) (36,281 )Cash and cash equivalents at start of year (27,880 ) 8,401Cash and cash equivalents at end of year (note 10) (48,383 ) (27,880 )The accompanying notes are an integral part of this statement.Financial Statements / Notes to the Accounts1.Accounting PoliciesThe financial statements of the Company have been prepared in accordance withInternational Financial Reporting Standards ("IFRS"). These comprise standardsand interpretations approved by the International Accounting Standards Board("IASB"), together with interpretations of the International AccountingStandards and Standing Interpretations Committee approved by the InternationalAccounting Standards Committee ("IASC") that remain in effect, to the extentthat IFRS have been adopted by the European Union.(a) Accounting ConventionThe financial statements have been prepared on a going concern under thehistorical cost convention, except for the measurement at fair value ofinvestments. Where presentational guidance set out in the Statement ofRecommended Practice ("the SORP") for Investment Trust Companies and VentureCapital Trusts produced by the Association of Investment Companies ("AIC")dated January 2009 is consistent with the requirements of IFRS, the Directorshave sought to prepare the financial statements on a basis compliant with therecommendations of the SORP.(b) InvestmentsInvestments are recognised and de-recognised on the trade date.As the entity's business is investing in financial assets with a view toprofiting from their total return in the form of dividends or increases in fairvalue, investments are designated as fair value through profit or loss and areinitially recognised at fair value. The entity manages and evaluates theperformance of these investments on a fair value basis in accordance with itsinvestment strategy, and information about the investments is providedinternally on this basis to the Board.Investments designated as at fair value through profit or loss, which arequoted investments, are measured at subsequent reporting dates at fair value,which is either the bid or the last trade price, depending on the convention ofthe exchange on which it is quoted.In respect of unquoted investments, or where the market for a financialinstrument is not active, fair value is established by using valuationtechniques which may include using recent arm's length market transactionsbetween knowledgeable, willing parties, if available, reference to the currentfair value of another instrument that is substantially the same, discountedcash flow analysis and option pricing models. Where there is a valuationtechnique commonly used by market participants to price the instrument and thattechnique has been demonstrated to provide reliable estimates of pricesobtained in actual market transactions, that technique is utilised.Gains and losses on disposal and fair value changes are also recognised in theIncome Statement.(c) Presentation of Income StatementIn order to better reflect the activities of an investment trust company, andin accordance with guidance issued by the AIC, supplementary information whichanalyses the Income Statement between items of a revenue and capital nature hasbeen presented alongside the Income Statement. Net revenue is the measure theDirectors believe appropriate in assessing the Company's compliance withcertain requirements set out in section 1158 of the Corporation Tax Act 2010.(d) IncomeDividends receivable on equity shares are recognised on the ex-dividend date.Where no ex-dividend date is quoted, dividends are recognised when theCompany's right to receive payment is established.Dividends from investments in unquoted shares and securities are recognisedwhen they become receivable.(e) Expenses and Finance CostsAll expenses are accounted for on an accruals basis. Expenses are chargedthrough the Income Statement as follows:expenses which are incidental to the acquisition or disposal of an investmentare charged to the capital column of the Income Statement;expenses are charged to the capital column of the Income Statement where aconnection with the maintenance or enhancement of the value of the investmentcan be demonstrated, and accordingly;AIFM and Portfolio management fees are charged to the capital column of theIncome Statement as the Directors expect that in the long term virtually all ofthe Company's returns will come from capital; andbank overdraft interest is charged through the Income Statement on an effectiverate basis and allocated to the capital column, as the Directors expect that inthe long term virtually all of the Company's returns will come from capital.(f) TaxationIn line with the recommendations of the SORP, the allocation method used tocalculate tax relief on expenses presented against capital returns in thesupplementary information in the Income Statement is the "marginal basis".Under this basis, if taxable income is capable of being offset entirely byexpenses presented in the revenue column of the Income Statement, then no taxrelief is transferred to the capital column.Investment trusts which have approval under Section 1158 Corporation Tax Act2010 are not liable for taxation on capital gains.Deferred tax is the tax expected to be payable or recoverable on differencesbetween the carrying amounts of assets and liabilities in the financialstatements and the corresponding tax bases used in the computation of taxableprofit, and is accounted for using the Balance Sheet liability method. Deferredtax liabilities are recognised for all taxable temporary differences anddeferred tax assets are recognised to the extent that it is probable thattaxable profits will be available against which deductible temporarydifferences can be utilised.Deferred tax is calculated at the tax rates that are expected to apply in theperiod when the liability is settled or the asset is realised. Deferred tax ischarged or credited in the Income Statement, except when it relates to itemscharged or credited directly to equity, in which case the deferred tax is alsodealt with in equity, or Other Comprehensive Income (OCI), in which case thedeferred tax is also dealt with in equity or OCI respectively.(g) Foreign CurrenciesThe currency of the primary economic environment in which the Company operates(the functional currency) is pounds sterling ("sterling"), which is also thepresentational currency of the Company. Transactions involving currencies otherthan sterling are recorded at the exchange rate ruling on the transaction date.At each Statement of Financial Position date, monetary items and non-monetaryassets and liabilities that are fair valued, which are denominated in foreigncurrencies, are retranslated at the closing rates of exchange.Exchange differences arising on settlements of monetary items and fromretranslating at the Statement of Financial Position date including investmentsand other financial instruments measured as fair value through profit or lossand other monetary items are included in the Income Statement and allocated ascapital if they are of a capital nature, or as revenue if they are of a revenuenature.(h) Functional and presentational currencyThe financial information is shown in sterling, being the Company'spresentational currency. In arriving at the functional currency the Directorshave considered the following:the primary economic environment of the Company;the currency in which the original capital was raised;the currency in which distributions are made;the currency in which performance is evaluated; andthe currency in which the capital would be returned to shareholders on a breakup basis.The Directors have also considered the currency to which the underlyinginvestments are exposed and liquidity is managed. The Directors are of theopinion that sterling best represents the functional currency.(i) ReservesCapital reservesThe following are credited or charged to the capital column of the IncomeStatement and then transferred to the Capital Reserve:gains or losses on disposal of investmentsexchange differences of a capital natureexpenses allocated to this reserve in accordance with the above referredpoliciesincreases and decreases in the valuation of investments held at year endCapital Redemption Reservea transfer will be made to this reserve on cancellation of the Company's ownshares purchased, equal to the nominal value of the SharesSpecial ReserveDuring the financial year ended 31 March 2004, a Special Reserve was created,following the cancellation of the Share Premium account, in order to provide anincreased distributable reserve out of which to purchase the Company's ownshares.a transfer will be made to this reserve on cancellation of the Company's ownshares purchased or when the Company repurchases its own shares to be held intreasury.(j) Cash and cash equivalentsCash in hand and in banks and short-term deposits with an original maturity ofthree months or less. Cash and cash equivalents are defined as cash in hand,demand deposits and short-term, highly liquid investments readily convertibleto known amounts of cash and subject to insignificant risk of changes in value.Bank overdrafts that are repayable on demand, which form an integral part ofthe Company's cash management, are included as a component of cash and cashequivalents for the purpose of the statement of cash flows.(k) Operating segmentsIFRS 8 requires entities to define operating segments and segment performancein the financial statements based on information used by the Board ofDirectors. The Directors are of the opinion that the Company is engaged in asingle segment of business, being the investments business. The resultspublished in this report therefore correspond to this sole operating segment.In line with IFRS 8, additional disclosure by geographical segment has beenprovided in note 14.(l) Standards, amendments and interpretations to existing standards becomeeffective in future accounting periods and have not been adopted by theCompany:IAS 1 Preparation of Financial Statements' - disclosure initiative amendmentsto further encourage companies to apply professional judgement in determiningwhat information to disclose and how to structure it in their financialstatements. The effective date is 1 January 2016.IFRS 7 Financial Instruments - Disclosures' (Amendment) - this amendmentclarifies that a servicing contract that includes a fee can constitutecontinuing involvement in a financial asset that has been transferred. Inrespect of IFRS 7 disclosures required in interims, the amendment clarifiesthat the IFRS 7 disclosures on offsetting are not required in the condensedinterim financial report. The effective date is 01 January 2016.IAS 34 Interim Financial Reporting'- the amendment states that the requiredinterim disclosures must either be in the interim financial statements orincorporated by cross- reference between the interim financial statements andwhere ever they are included with in the greater interim financial report (eg:Portfolio manager's review) The effective date is 01 January 2016.IFRS 9 Financial Instruments - In July 2014, the IASB issued the final versionof IFRS 9 Financial Instruments which reflects all phases of the financialinstruments project and replaces IAS 39 Financial Instruments: Recognition andMeasurement and all previous versions of IFRS 9. The standard introduces newrequirements for classification and measurement, impairment, and hedgeaccounting. IFRS 9 is effective for annual periods beginning on or after 1January 2018, with early application permitted. Retrospective application isrequired but comparative information is not compulsory. Early application ofprevious versions of IFRS 9 (2009, 2010 and 2013) is permitted if the date ofinitial application is before February 2015. The adoption of IFRS 9 is unlikelyto have a material effect on the classification and measurement of the Fund'sfinancial assets or financial liabilities.2. Income 2015 2014 £'000 £'000Investment incomeOverseas dividend income 988 873Total income 988 8733. AIFM, Portfolio Management and Performance Fees 2015 2014 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000AIFM fee - 1,249 1,249 - 890 890Portfolio managementfee - 2,766 2,766 - 1,967 1,967Performance fee - 1,854 1,854 - (94 ) (94 ) - 5,869 5,869 - 2,763 2,763As at 31 March 2015, a performance fee totalling £1,854,000 is accrued (2014: £982,000). This represents total outperformance generated as at 31 March 2015(see note 10).In accordance with the Performance fee arrangements with the Company, theamounts accrued will only become payable in the event that outperformance ismaintained for a twelve month period.The amounts accrued potentially become payable on the following dates: £'00030-Jun-15 nil30-Sep-15 18331-Dec-15 nil31-Mar-16 1,671Total 1,854No performance fee is payable as at 31 March 2015 (2014: £982,000).Further details of the performance fee basis and amounts paid during the yearcan be found in the Report of the Directors.4.Other Expenses 2015 2014 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000Directors' emoluments 165 - 165 182 - 182AIFM fixed fee 60 - 60 60 - 60Auditors'remuneration for theaudit of theCompany's financialstatements 25 - 25 25 - 25Auditors'remuneration forindependent review ofthe half yearaccounts andperformance feecalculations 6 - 6 6 - 6Auditor'sremuneration fortaxation services 3 - 3 4 - 4Legal andprofessional fees 84 - 84 196 - 196Registrar fees 49 - 49 49 - 49Depositary fees 50 - 50 - - -Listing fees 23 - 23 49 - 49Other includingirrecoverable VAT 270 - 270 298 - 298 735 - 735 869 - 869Details of the amounts paid to Directors are included in the Directors'Remuneration Report and the Directors' Remuneration Policy Report.5.Finance Costs 2015 2014 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000Overdraft interest - 157 157 - 94 94 - 157 157 - 94 946.Taxation(a) Analysis of charge in the year: 2015 2014 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000Overseas tax suffered 132 - 132 94 - 94Total currenttaxation for the year(see note 6(b)) 132 - 132 94 - 94(b) Factors affecting current tax charge for yearApproved investment trusts are exempt from tax on capital gains made within theCompany.The tax assessed for the year is lower than the standard rate of corporationtax in the UK of 21% (2014: 23%). The differences are explained below: 2015 2014 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000Net profit onordinaryactivities beforetaxation 253 214,139 214,392 4 86,427 86,431Corporation taxat 21% (2014:23%) 53 44,969 45,022 1 19,878 19,879Effects of:Non-taxable gainson investmentsheld at fairvalue throughprofit or loss - (46,235 ) (46,235 ) - (20,535 ) (20,535 )Non-taxableoverseasdividends (208 ) - (208 ) (201 ) - (201 )Overseas taxes 132 - 132 94 - 94Excess expensesunused 155 1,266 1,421 198 657 855Disallowedexpenses - - - 2 - 2Current taxcharge 132 - 132 94 - 94(c) Provision for deferred taxNo provision for deferred taxation has been made in the current or prior year.The Company has not provided for deferred tax on capital gains or lossesarising on the revaluation or disposal of investments, as it is exempt from taxon these items because of its status as an investment trust company.The Company has not recognised a deferred tax asset of £6,954,000 (2014: £5,618,000) arising as a result of excess management expenses and loanrelationship deficits. The deferred tax asset is based on a prospectivecorporation tax rate of 20%, which was enacted in July 2013 and effective from1 April 2015.These excess expenses will only be utilised if the Company generates sufficienttaxable income in the future.7.Basic and Diluted Earnings/(Loss) per ShareThe Return/(loss) per Ordinary Share is as follows: 2015 2014 Revenue Capital Total Revenue Capital Total pence pence pence pence pence penceEarnings/(loss) pershare 0.2p 327.8p 328.0p (0.1p ) 126.9p 126.8pThe total gain per share of 328.0p (2014: gain 126.8p) is based on the totalgain attributable to equity shareholders of £214,260,000 (2014: gain £86,337,000).The revenue gain per share 0.2p (2014: loss 0.1p) is based on the revenue gainattributable to equity shareholders of £121,000 (2014: revenue loss of £90,000). The capital gain per share of 327.8p (2014: gain 126.9p) is based onthe capital gain attributable to equity shareholders of £214,139,000 (2014:gain £86,427,000).The total earnings per share are based on the weighted average number of sharesin issue during the year of 65,319,717 (excluding shares held in treasury)(2014: 68,115,445 (excluding shares held in treasury)).8. Investments Held at Fair Value Through Profit and LossAll investments are designated as fair value through profit or loss on initialrecognition, therefore all gains and losses arise on investments designated asfair value through profit or loss.As at 31 March 2015, all investments with the exception of the unquotedinvestment in OrbiMed Asia Partners L.P fund have been classified as level 1.OrbiMed Asia Partners L.P fund has been classified as level 3. See note 13. 2015 2014 Listed Equity Unquoted Total Total £'000 £'000 £'000 £'000Cost at 1 April 2014 266,264 2,541 268,805 168,015Investment holding gains at 1April 2014 99,603 (46 ) 99,557 76,281Valuation at 1 April 2014 365,867 2,495 368,362 244,296Movement in the yearPurchases at cost 349,812 267 350,079 306,062Sales - proceeds (360,255 ) - (360,255 ) (269,610 )- gains on disposal 88,211 - 88,211 64,338Net movement in investmentholding gains 136,135 677 136,812 23,276Valuation at 31 March 2015 579,770 3,439 583,209 368,362Closing book cost at 31 March2015 344,013 2,827 346,840 268,805Investment holding gains at 31March 2015 235,757 612 236,369 99,557Valuation at 31 March 2015 579,770 3,439 583,209 368,362 2015 2014 £'000 £'000Gains on investments:Gains on disposal based onhistorical cost 88,211 64,338Amounts recognised as investmentholding gain in previous year (43,024 ) (38,085 )Gains on disposal based oncarrying value at previousfinancial position date 45,187 26,253Net movement in investmentholding gains in the year 179,836 61,361Gains on investments 225,023 87,614The total transaction costs for the year were £499,000 (31 March 2014: £707,000) broken down as follows: purchase transaction costs for the year to 31March 2015 were £210,000, (31 March 2014: £412,000), sale transaction costswere £289,000 (31 March 2014: £295,000). These costs consist mainly ofcommission and stamp duty.9. Other Receivables 2015 2014 £'000 £'000Future settlements - sales 3,187 11,795Other debtors 15 105Prepayments and accrued income 123 172 3,325 12,07210. Other Payables 2015 2014 £'000 £'000Future settlements - purchases 1,582 10,427Performance fee accrued 1,854 982Bank overdraft* 48,383 27,880Other creditors and accruals 1,413 897 53,232 40,186* Further details can be found in note 13.11. Ordinary share capital 2015 2014 £'000 £'000Allotted, issued and fully paid:63,888,516 shares of 25p (2014:68,224,038) 15,972 17,0564,997,831 shares of 25p held intreasury (2014: 662,309) 1,250 166 17,222 17,222 Issued & Treasury Outstanding fully paid Shares SharesAt 1 April 68,886,347 662,309 68,224,038Repurchase of own shares to be held intreasury - 4,445,522 (4,445,522 )Sale of treasury shares - (110,000 ) 110,000 68,886,347 4,997,831 63,888,516As at 31 March 2015 the Company had 68,886,347 shares of 25p in issue including4,997,831 shares held in treasury (2014: 68,886,347 shares including 662,309shares held in treasury). During the year 4,445,522 shares were repurchased tobe held in treasury at a cost of £22,043,000 (including expenses). Also duringthe year 110,000 shares were re-issued from treasury raising £837,000.Subsequent to the year end and to the date of this report a further 701,783shares were repurchased to be held in treasury at a cost of £5,578,000(including expenses).12. Net Asset Value per Share 2015 2014Net asset value per share 834.7p 498.7pThe net asset value per share is based on the net assets attributable to equityshareholders of £533,302,000 (2014: £340,248,000) and on 63,888,516 (excluding4,997,831 shares held in treasury) (2014: 68,224,038) shares in issue at 31March 2015.13.Risk Management Policies and ProceduresAs an investment trust, the Company invests in equities and other investmentsfor the long term in order to achieve its investment objective. In pursuing itsinvestment objective, the Company is exposed to a variety of risks that couldresult in either a reduction or increase in the Company's net assets or inprofits.The Company's financial instruments comprise securities and other investments,cash balances, debtors and creditors and an overdraft facility that arisedirectly from its operations (for example, in respect of sales and purchasesawaiting settlement).The main risks the Company faces from its financial instruments are (i) marketprice risk (comprising currency risk, interest rate risk and other price risk(i.e. changes in market prices other than those arising from interest rate orcurrency risk)), (ii) liquidity risk and (iii) credit risk.The Board reviews and agrees policies regularly for managing and monitoringeach of these risks.1. Market price risk:The fair value or future cash flows of a financial instrument held by theCompany may fluctuate because of changes in market prices. This market riskcomprises three elements - currency risk, interest rate risk and other pricerisk.The Company's portfolio is exposed to market price fluctuations which aremonitored by the AIFM and the Portfolio Manager in pursuance of the investmentobjective.No derivatives or hedging instruments are utilised to manage market price risk.(a) Currency risk:A significant proportion of the Company's portfolio is denominated incurrencies other than sterling (the Company's functional currency, and in whichit reports its results). As a result, movements in exchange rates cansignificantly affect the sterling value of those items.Management of riskThe AIFM and Portfolio Manager monitor the Company's exposure to foreigncurrencies on a continuous basis and report to the Board regularly. The Companydoes not hedge against foreign currency movements, but the Portfolio Managertakes account of the risk when making investment decisions.Income denominated in foreign currencies is converted into sterling on receipt.The Company does not use financial instruments to mitigate the currencyexposure in the period between the time that the income is included in thefinancial statements and its receipt.Foreign currency exposureAt the date of the Statement of Financial Position the Company held £562,512,000 (2014: £345,433,000) of investments denominated in U.S. dollars and£20,697,000 (2014: £22,929,000) in other non-sterling currencies.Currency sensitivityThe following table details the sensitivity of the Company's profit or lossafter taxation for the year to a 10% increase and decrease in the value ofsterling compared to the U.S. dollar (2014: 10% increase and decrease).The above percentages have been determined based on market volatility inexchange rates over the previous twelve months. The analysis is based on theCompany's foreign currency financial instruments held at each Statement ofFinancial Position date, after adjusting for an increase/decrease in managementfees. Movements in the performance fee accruals have been excluded from theanalysis below.If sterling had weakened against U.S. dollars, as stated above, this would havehad the following effect: 2015 2014 USD USD £'000 £'000Impact on revenue return - -Impact on capital return 62,095 38,132Total return after tax/effect on shareholders' funds 62,095 38,132If sterling had strengthened against the U.S. dollar, as stated above, thiswould have had the following effect: 2015 2014 USD USD £'000 £'000Impact on revenue return - -Impact on capital return (50,805 ) (31,199 )Total return after tax/effect on shareholders' funds (50,805 ) (31,199 )(b) Interest rate risk:Interest rate risk is the risk that the fair value of future cash flows of afinancial instrument will fluctuate because of changes in market interestrates.Management of the riskThe possible effects on fair value and cash flows that could arise as a resultof changes in interest rates are taken into account when making investmentdecisions.The Company, generally, does not hold significant cash balances, with shortterm borrowing being used when required and therefore deems this risk to beimmaterial.Interest rate exposureThe Company has an overdraft facility with J.P. Morgan Clearing Corp. which isrepayable on demand.(c) Other price riskOther price risk may affect the value of the quoted investments.If market prices at the date of the Statement of Financial Position had been20% higher or lower (2014: 20% higher or lower) while all other variables hadremained constant, the return and net assets attributable to shareholders forthe year ended 31 March 2015 would have increased/decreased by £115,884,000(2014: £73,193,000), after adjusting for an increase or decrease in the AIFMand Portfolio management fees. The calculations are based on the portfoliovaluations as at the respective Statement of Financial Position dates.2. Liquidity risk:This is the risk that the Company will encounter difficulty in meetingobligations associated with financial liabilities.Management of the riskLiquidity risk is not significant as the majority of the Company's assets areinvestments in quoted equities and other quoted securities that are readilyrealisable. The Company has an overdraft facility repayable on demand, providedby J.P. Morgan Clearing Corp. Interest on the facility is charged at theFederal Funds open rate plus 45 basis points.The Board gives guidance to the Portfolio Manager as to the maximum amount ofthe Company's resources that should be invested in any one company.Liquidity exposureContractual maturities of the financial liabilities as at 31 March 2015, basedon the earliest date on which payment can be required, are as follows:Amounts due to brokers and accruals totalling £4,849,000 (2014: £12,306,000).All of the stated financial liabilities are payable within three months orless.3. Credit risk:The failure of the counterparty to a transaction to discharge its obligationsunder that transaction could result in the Company suffering a loss.Certain of the Company's assets are held by J.P. Morgan Clearing Corp. ascollateral for the loan provided by them to the Company. Such assets held byJ.P. Morgan Clearing Corp. are available for rehypothecation†. As at 31 March2015, assets with a total market value of £67.7 million (31 March 2014: £37.1million) were available for rehypothecation.† See glossary.Management of the riskThe risk is not significant and is managed as follows:by only dealing with brokers which have been approved by OrbiMed Capital LLCand banks with high credit ratings; andby setting limits to the maximum exposure to any one counterparty at any time.all cash balances are held with approved counterparties. J.P. Morgan ClearingCorp. is the custodian of the Company's assets and all assets are segregatedfrom J.P. Morgan's own assets.At 31 March 2015 the Company's exposure to credit risk amounted to £3,325,000and was in respect of cash and other receivables, such as amounts due frombrokers and accrued income (2014: £12,072,000).Hierarchy of investmentsThe Company has classified its financial assets designated at fair valuethrough profit or loss using a fair value hierarchy that reflects thesignificance of the inputs used in making the fair value measurements. Thehierarchy has the following levels:Level 1 - quoted prices (unadjusted) in active markets for identical assets orliabilities;Level 2 - inputs other than quoted prices included with Level 1 that areobservable for the asset or liability, either directly (i.e. as prices) orindirectly (i.e. derived from prices); andLevel 3 - inputs for the asset or liability that are not based on observablemarket data (unobservable inputs).As at 31 March 2015 the investment in OrbiMed Asia Partners LP fund has beenclassified as Level 3. The fund has been valued at the net asset value as at 31December 2014 and it is believed that the value of the fund as at 31 March 2015will not be materially different. If the value of the fund was to increase ordecrease by 10%, while all other variables had remained constant, the returnand net assets attributable to Shareholders for the year ended 31 March 2015would have increased/decreased by £344,000. Level Level Level 1 2 3 TotalAs of 31 March 2015 £'000 £'000 £'000 £'000AssetsFinancial investments designated at fairvalue through profit or loss 579,770 - 3,439 583,209 Level Level Level 1 2 3 TotalAs of 31 March 2014 £'000 £'000 £'000 £'000AssetsFinancial investments designated at fairvalue through profit or loss 365,867 - 2,495 368,362Level 3 ReconciliationPlease see below a reconciliation disclosing the changes during the year forthe financial assets and liabilities designated at fair value through profit orloss classified as being Level 3. There has been no transfer between fair valuehierarchy. 2015 2014 £'000 £'000AssetsAs at 1 April 2,495 2,506Total gains during the year 677 (334 )Net capital commitments 267 323Assets as at 31 March 3,439 2,495Fair value of financial assets and financial liabilities:Financial assets and financial liabilities are either carried in the Statementof Financial Position at their fair value or at a reasonable approximation offair value.Capital management policies and proceduresThe Company's capital management objectives are:to ensure that it will be able to continue as a going concern; andto maximise the total return to its equity shareholders through an appropriatebalance of equity capital and debt.The Company's capital is disclosed in the Statement of Financial Position andis managed on a basis consistent with its investment objective and policy. TheCompany currently has an overdraft facility with J.P. Morgan Clearing Corp.which is repayable on demand, which can be used to satisfy the Company'sborrowing requirements.The Board, with the assistance of the AIFM and the Portfolio Manager, monitorsand reviews the broad structure of the Company's capital on an ongoing basis.This review includes:the planned level of gearing, which takes into account the Portfolio Manager'sview of the market;the need to buy back equity shares, for cancellation, or to be held in treasurywhich takes account of the difference between the net asset value per share andthe share price (i.e. the level of share price discount or premium);the possible need for new issues of equity shares; andthe extent to which revenue is in excess of that which is required to bedistributed should be retained.The Company's objectives, policies and processes for managing capital areunchanged from the preceding accounting period.14. Segment ReportingGeographical segments 2015 2014 Value of Value of investments investmentsRegion £'000 £'000North America 494,236 327,112Europe 74,870 24,488Asia 14,103 16,762Total 583,209 368,36215.Related PartiesThe following are considered to be related parties:Frostrow Capital LLP (under the Listing Rules)OrbiMed Capital LLCThe Directors of the CompanyDetails of the relationship between the Company and Frostrow Capital LLP, theCompany's AIFM and OrbiMed Capital LLC, the Company's Portfolio Manager, aredisclosed in the Report of Directors. During the year ended 31 March 2015Frostrow Capital LLP earned £1,309,000 in respect of AIFM fees of which £390,000 was outstanding at the year end; during the year ended 31 March 2015,OrbiMed Capital LLC earned £2,766,000 in respect of Portfolio Management fees,of which £849,000 was outstanding at the year end. Mr Sven Borho is a Directorof the Company, as well as a Partner at OrbiMed Capital LLC. During the year noperformance fees crystallised, however a fee of £1,854,000 was accrued at theyear end which could potentially become payable at a later date (see note 3 forfurther details). All material related party transactions have been disclosedwithin the Directors Remuneration Report and in note 3 and 4.16. Capital Reserve Capital reserve - investment Capital holdings reserves - gains/ other (losses) Total £'000 £'000 £'000At 31 March 2014 157,211 99,557 256,768Transfer on disposal of investments 43,024 (43,024) -Net gains on investments 45,187 179,836 225,023Exchange losses (4,858) - (4,858)Expenses charged to capital (6,026) - (6,026)At 31 March 2015 234,538 236,369 470,907Profits arising out of a change in fair value of assets, recognised inaccordance with Accounting Standards, may be distributed provided the relevantassets can be readily convertible into cash. Securities listed on a recognisedstock exchange are generally regarded as being readily convertible into cash.Under the terms of the revisions made to the Company's Articles of Associationin 2013, sums within "Capital reserves - other" are also available fordistribution.Corporate Report / Report of the DirectorsIn accordance with the requirements of the Companies Act 2006 (the "Act") andthe UK Listing and Transparency Rules, the Directors present their annualreport on the affairs of the Company, together with the audited FinancialStatements and the Independent Auditors' Report for the year ended 31 March2015.The Corporate Governance section forms part of this Report of the Directors.Disclosures relating to future developments and risk management can be foundwithin the Strategic Report.Business and Status of the CompanyThe Company is registered as a public limited company and is an investmentcompany within the terms of Section 833 of the Act. Its shares are listed onthe Official List of the UK Listing Authority and traded on the main market ofthe London Stock Exchange which is a regulated market as defined in Section1173 of the Act.The Company has received approval from HM Revenue & Customs as an authorisedinvestment trust under Sections 1158 and 1159 of the Corporation Tax Act 2010("CTA 2010"), for the year commencing 1 April 2012. This approval is subject tothere being no subsequent enquiry under corporation tax self-assessment. In theopinion of the Directors, the Company continues to direct its affairs so as toenable it to qualify for such approval.It is the Directors' intention that the Company should continue to manage itsaffairs so as to be a qualifying investment for inclusion in the stocks andshares components of an Individual Savings Account ("ISA") and Junior ISA.The Company is required to comply with company law, the rules of theInternational Listing Authority, International Financial Reporting Standards,and its Articles of Association.The Company is a member of the Association of Investment Companies ("AIC").Continuation of the CompanyA resolution was passed at a General Meeting of the Company held on 4 December2009, that the Company continue as an investment trust for a further five yearperiod (from the Annual General Meeting held in 2010). In accordance withCompany's Articles of Association a resolution will be proposed at theforthcoming Annual General Meeting that the Company continue as an investmenttrust for a further five year period.If passed the next continuation vote of the Company shall be held at the AnnualGeneral Meeting in 2020 and further opportunities to vote on the continuationof the Company shall be given to shareholders every five years thereafter.Investment ObjectiveThe Company seeks capital appreciation through investment in the worldwidebiotechnology industry. In order to achieve its investment objective, theCompany invests in a diversified portfolio of shares and related securities inbiotechnology companies on a worldwide basis.Investment PolicyIn order to achieve its investment objective, the Company invests in adiversified portfolio of shares and related securities in biotechnologycompanies on a worldwide basis.Results and DividendThe results attributable to shareholders for the year and the transfer toreserves are shown within the Income Statement. No dividend is proposed inrespect of the year ended 31 March 2015 (2014: nil).Overdraft FacilityThe Company's borrowing requirements are met through the utilisation of anoverdraft facility, repayable on demand, provided by J.P. Morgan Clearing Corp.(Further details can be found in note 13).Share CapitalAs part of the package of measures adopted in 2005 by the Board to improve theattraction of the Company's shares to new investors and also to provide theprospect of a sustained improvement in the rating of the Company's shares, anactive discount management policy was implemented to buy-back shares to eitherhold in treasury or for cancellation if the market price is at a discountgreater than 6% to net asset value per share. As at 31 March 2015, the discountwas 4.9%, which was within the stated target of 6%. The making and timing ofany share buy-back remains at the absolute discretion of the Board. Authorityto buy-back up to 14.99% of the Company's issued share capital is sought ateach Annual General Meeting.During the year a total of 4,445,522 shares were bought back to hold intreasury representing 6.5% of the issued share capital at the beginning of theyear. The purchases were made at a total cost of £22,043,000 (includingexpenses) at an average price of £4.96 per buy-back.In addition during the year, 110,000 shares were issued from treasury raising £837,000 for the Company. Subsequent to the year end to 21 May 2015 a further701,783 shares were bought back to hold in treasury. As at 21 May 2015 therewere 68,886,347 (including 5,699,614 shares held in treasury) shares in issue.Company ManagementThe Board announced on 21 July 2014 that with effect from 22 July 2014 theCompany was adjusting its operational arrangements in order to comply withAIFMD. As a consequence of AIFMD the Company appointed Frostrow as thedesignated AIFM for the Company on the terms and subject to the conditions ofthe alternative investment fund management agreement between the Company andFrostrow (the "AIFM Agreement"), which terminated and replaced the thenexisting management, administrative and secretarial services agreement betweenthe Company and Frostrow (the "Existing Management Agreement"). The AIFMAgreement is based on the Existing Management Agreement and differs to theextent necessary to ensure that the relationship between the Company andFrostrow is compliant with the requirements of AIFMD.OrbiMed, as delegate of the AIFM, continues to be responsible for themanagement of the Company's portfolio of investments under a new portfoliomanagement agreement between it, the Company and Frostrow (the "PortfolioManagement Agreement"). The Portfolio Management Agreement terminated andreplaced the then existing investment management agreement between the Companyand OrbiMed (the "Existing IMA"). The Portfolio Management Agreement is basedon the Existing IMA and differs to the extent necessary to ensure that therelationship between the Company, OrbiMed and Frostrow is compliant with therequirements of AIFMD.The Company also appointed J.P. Morgan Europe Limited (the "Depositary") as itsdepositary in accordance with AIFMD on the terms and subject to the conditionsof the depositary agreement between the Company, Frostrow and the Depositary(the "Depositary Agreement"). The existing custody agreement between theCompany and Goldman Sachs & Co. was terminated. Under the terms of theDepositary Agreement the Company has agreed to pay the Depositary a feecalculated at 1.75 bps on net assets up to £150 million, 1.50 bps on net assetsbetween £150 million and £300 million, 1.00 bps on net assets between £300million and £500 million and 0.50 bps on net assets above £500 million.The Depositary has delegated the custody and safekeeping of the Company'sassets to J.P. Morgan Clearing Corp (the "Prime Broker") pursuant to adelegation agreement between the Company, Frostrow, the Depositary and thePrime Broker (the "Delegation Agreement").The Delegation Agreement transfers the Depositary's liability under Article 21(12) of the AIFMD for the loss of the Company's financial instruments held incustody by the Prime Broker to the Prime Broker in accordance with Article 21(13) of the AIFMD. While the Depositary Agreement prohibits the re-use of theCompany's assets by the Depositary or the Prime Broker without the priorconsent of the Company or Frostrow, the Company has consented to the transferand reuse of its assets by the Prime Broker (known as "rehypothecation") inaccordance with the terms of an institutional account agreement between theCompany, the Prime Broker and certain other JPMorgan Entities (as definedtherein) (the "Institutional Account Agreement").The Prime Broker is authorised to borrow, lend or otherwise use all cash andany security carried by the Prime Broker in the Company's accounts for agreater sum than, and for period longer than, the Company's obligations to theJPMorgan Entities and the Prime Broker will have no obligation to maintain alike amount of similar property in possession or control. In the event of thePrime Broker's insolvency, the Company may be unable to recover such assets infull. The Prime Broker is a registered broker-dealer and is accordingly subjectto certain limitations on rehypothecation. Specifically, the Prime Broker issubject to and has acknowledged in the Institutional Account Agreement thelimitations contemplated by the United States Securities and ExchangeCommission Rule 15c3-3, requiring a broker-dealer to maintain possession andcontrol of all excess margin securities (i.e. margin securities carried for theaccount of a customer having a market value in excess of 140% of the net debitbalances, taking into account the mark to market on the short market value inrespect of a short position, in the customer's account with suchbroker-dealer).Alternative Investment Fund Management AgreementUnder the terms of the AIFM Agreement Frostrow receives a periodic fee equal to0.30% per annum of the Company's market capitalisation, plus a fixed amountequal to £60,000 per annum. Either party may terminate the AIFM Agreement onnot less than 12 months' notice.The services provided by the AIFM are set out within the Strategic Report.Portfolio Management AgreementUnder the terms of the Portfolio Management Agreement, OrbiMed, acting as adelegate of the AIFM, provides discretional management services to the Companyfor a periodic fee equal to 0.65% per annum of the Company's net asset value.The proportion of the Company's assets committed for investment in OrbiMed AsiaPartners L.P., a limited partnership managed by OrbiMed Asia G.P., L.P., anaffiliate of the Portfolio Manager, is excluded from the fee calculation. ThePortfolio Management Agreement may be terminated by either Frostrow or thePortfolio Manager giving notice of not less than 12 months.The services provided by the Portfolio Manager are set out within the StrategicReport.Performance FeeDependent on the level of long-term outperformance of the Company, the AIFM andPortfolio Manager are entitled to the payment of a performance fee. Theperformance fee is calculated by reference to the amount by which the Company'snet asset value ('NAV') performance has outperformed the NASDAQ BiotechnologyIndex (sterling adjusted), the Company's benchmark index.The fee is calculated quarterly by comparing the cumulative performance of theCompany's NAV with the cumulative performance of the benchmark since thecommencement of the performance fee arrangement on 30 June 2005. Theperformance fee amounts to 16.5% of any outperformance over the benchmark, theAIFM receiving 1.5% and the Portfolio Manager receiving 15% respectively.Provision is also made within the daily NAV per share calculation as requiredand in accordance with generally accepted accounting standards.In order to ensure that only sustained outperformance is rewarded, at eachquarterly calculation date any performance fee is based on the lower of:The cumulative outperformance of the portfolio over the benchmark as at thequarter end date; andThe cumulative outperformance of the portfolio over the benchmark as at thecorresponding quarter end date in the previous year.In addition, a performance fee only becomes payable to the extent that thecumulative outperformance gives rise to a total fee greater than the total ofall performance fees paid to date.See note 3 for details of the performance fee accrued as at 31 March 2015.The proportion of the Company's assets invested in OrbiMed Asia Partners L.P.is excluded from the Portfolio Manager's performance fee calculation.AIFM Evaluation and Re-Appointment and Portfolio ManagerThe performance of the AIFM and the Portfolio Manager is reviewed continuouslyby the Company's Audit and Management Engagement Committee (the "Committee")with a formal evaluation being undertaken each year. As part of this process,the Committee monitors the services provided by the AIFM and the PortfolioManager and receives regular reports and views from them. The Committee alsoreceives comprehensive performance measurement reports to enable it todetermine whether or not the performance objectives set by the Board have beenmet. The Committee reviewed the appropriateness of the appointment of the AIFMand the Portfolio Manager in February 2015 with a recommendation being made tothe Board.The Board believes the continuing appointment of the AIFM and the PortfolioManager, under the terms described above, is in the interests of shareholdersas a whole. In coming to this decision, it also took into consideration thefollowing additional reasons:the quality and depth of experience allocated by the Portfolio Manager to themanagement of the portfolio and the level of performance of the portfolio inabsolute terms and also by reference to the benchmark index; andthe quality and depth of experience of the company management, companysecretarial, administrative and marketing team that the AIFM allocates to themanagement of the Company.DirectorsDirectors' FeesPlease see the report on Directors' Remuneration and also the Directors'Remuneration Policy ReportDirectors' & Officers' Liability Insurance CoverDirectors' & Officers' liability insurance cover was maintained by the Boardduring the year ended 31 March 2015. It is intended that this policy willcontinue for the year ended 31 March 2016 and subsequent years.Directors' IndemnitiesAs at the date of this report, indemnities are in force between the Company andeach of its Directors under which the Company has agreed to indemnify eachDirector, to the extent permitted by law, in respect of certain liabilitiesincurred as a result of carrying out his/her role as a Director of the Company.The Directors are also indemnified against the costs of defending any criminalor civil proceedings or any claim by the Company or a regulator as they areincurred provided that where the defence is unsuccessful the Director mustrepay those defence costs to the Company. The indemnities are qualifying thirdparty indemnity provisions for the purposes of the Companies Act 2006.A copy of each deed of indemnity is available for inspection at the Company'sregistered office during normal business hours and will be available forinspection at the Annual General Meeting.Directors' InterestsThe beneficial interests in the Company of the Directors and their connectedpersons, are set out within the Directors Remuneration Report.Substantial ShareholdingsThe Company was aware of the following substantial interests in the votingrights of the Company as at 30 April 2015, the latest practicable date beforepublication of the annual report. 30 April 2015 31 March 2015 % of % of Issued Issued No. of share No. of shareShareholders shares capital shares capitalHargreaves Lansdown* 6,381,389 10.4 6,493,342 10.2East Riding of Yorkshire 4,750,000 7.5 4,750,000 7.4Reliance Mutual 2,896,472 4,7 3,104,450 4.9Alliance Trust Savings 2,782,238 4.4 2,834,699 4.4Standard Life Wealth 2,557,380 4.0 2,747,361 4.3Hansa Capital Partners 2,351,629 3.7 2,351,629 3.7Barclays Stockbrokers 1,916,384 3.0 1,952,606 3.1* the ultimate controlling party of the Company which is incorporated in theUnited Kingdom.As at 31 March 2015 the Company had 68,886,347, (including 4,997,831 sharesheld in treasury) shares in issue. As at 30 April 2015 the Company had68,886,347 (including 5,699,614 shares held in treasury) shares in issue.Beneficial Owners of Shares - Information RightsBeneficial owners of shares who have been nominated by the registered holder ofthose shares to receive information rights under section 146 of the CompaniesAct 2006 are required to direct all communications to the registered holder oftheir shares rather than to the Company's registrar, Capita Asset Services, orto the Company directly.Retail Investors advised by IFAsThe Company currently conducts its affairs so that its shares can berecommended by Independent Financial Advisers ("IFAs") in the UK to ordinaryretail investors in accordance with the Financial Conduct Authority ("FCA")rules in relation to non-mainstream investment products and intends to continueto do so. The shares are excluded from the FCA's restrictions which apply tonon-mainstream investment products because they are shares in an authorisedinvestment trust.Financial InstrumentsThe Company's financial instruments comprise its portfolio, cash balances,debtors and creditors that arise directly from its operations, such as salesand purchases awaiting settlement and accrued income. The financial riskmanagement and policies arising from its financial instruments are disclosed innote 13 to the Financial Statements.Awareness and Disclosure of Relevant Audit InformationSo far as each of the Directors is aware, there is no relevant auditinformation (as defined in the Companies Act) of which the Company's auditorsare unaware.Each of the Directors has taken all the steps that he or she ought to havetaken as a Director in order to make himself or herself aware of any relevantaudit information (as defined) and to establish that the Company's auditors areaware of that information.The above confirmation is given and should be interpreted in accordance withthe provision of Section 418 of the Companies Act 2006.Individual Savings AccountsThe Company's shares are eligible to be held in the stocks and shares componentof an ISA or Junior ISA, subject to applicable annual subscription limits (£11,880 for an ISA and £3,840 for a Junior ISA for the 2014/2015 tax year).Investments held in ISAs or Junior ISAs will be free of UK tax on both capitalgains and income. The opportunity to invest in Ordinary Shares through an ISAis restricted to certain UK resident individuals aged 18 or over. Junior ISAsare available for UK resident children aged under 18 and born before1 September 2002 or after 2 January 2011. Sums received by a shareholder on adisposal of Ordinary Shares held within an ISA or Junior ISA will not counttowards the shareholder's annual limit. Individuals wishing to invest inOrdinary Shares through an ISA should contact their professional advisersregarding their eligibility as should individuals wishing to invest through aJunior ISA for children under 18 years old.With effect from 1 July 2014 the government announced that ISAs will bereformed into a new simpler product, the New ISA ("NISA") with equal limits forcash, and stocks and shares.The overall NISA limits for 2014/15 are £15,000 which offers the option to savein cash, stocks and shares, or any combination of two.S.1 2007/1093 C.49 Commencement No2. Order 2007The following disclosures are made in accordance with S.1 2007/1093 C.49Commencement No2. Order 2007.Capital structureThe Company's capital structure is composed solely of Ordinary Shares. Detailsare given in note 11 to the Financial Statements.Voting rights in the Company's sharesDetails of the voting rights in the Company's shares at the date of this annualreport are given in note 9 to the Notice of Annual General Meeting.Going ConcernThe Directors believe that it is appropriate to adopt the going concern basisin preparing the Financial Statements as the assets of the Company consistmainly of securities that are readily realisable and, accordingly, the Companyhas adequate financial resources to continue in operational existence for theforeseeable future. In accordance with the Company's Articles of Association aresolution will be proposed at the forthcoming Annual General Meeting that theCompany continue as an investment trust for a further five year period.Anti-Bribery and Corruption PolicyThe Board has adopted a zero tolerance approach to instances of bribery andcorruption. Accordingly it expressly prohibits any Director or associatedpersons when acting on behalf of the Company, from accepting, soliciting,paying, offering or promising to pay or authorise any payment, public orprivate, in the United Kingdom or abroad to secure any improper benefit forthemselves or for the Company.Charitable DonationsThe Company has not in the past and does not intend in the future to makecharitable donations.Political DonationsThe Company has not in the past and does not intend in the future to makepolitical donations.Global Greenhouse Gas EmissionsThe Company has no greenhouse gas emissions to report from its operations, nordoes it have responsibility for any other emissions producing sources underLarge and Medium sized Companies and Groups (Accounts and Reports) Regulations2008 (as amended), (including those within our underlying investmentportfolio).Corporate GovernanceThe Corporate Governance report, which includes the Company's CorporateGovernance policies is publically available as part of the company's annualreport and can be viewed on the Company's website www.biotechgt.com.By order of the BoardFrostrow Capital LLPCompany Secretary21 May 2015Corporate Report / Statement of Directors' ResponsibilitiesThe Directors are responsible for preparing the Annual Report and the FinancialStatements in accordance with applicable United Kingdom law and regulations.Company law requires the directors to prepare Financial Statements for eachfinancial year. Under that law, the directors are required to prepare FinancialStatements under International Financial Reporting Standards ("IFRSs") asadopted by the European Union.Under Company Law the directors must not approve the Financial Statementsunless they are satisfied that they give a true and fair view of the state ofaffairs of the Company and of the profit or loss of the Company for thatperiod. In preparing the Financial Statements the directors are required to:present fairly the financial position, financial performance and cash flows ofthe Company;select suitable accounting policies in accordance with IAS 8: AccountingPolicies, Changes in Accounting Estimates and Errors and then apply themconsistently;present information, including accounting policies, in a manner that providesrelevant, reliable comparable and understandable information;make judgements that are reasonable;provide additional disclosures when compliance with the specific requirementsin IFRSs as adopted by the European Union is insufficient to enable users tounderstand the impact of particular transactions, other events and conditionson the Company's financial position and financial performance; andstate whether the Company's Financial Statements have been prepared inaccordance with IFRSs as adopted by the European Union;Responsibility Statement of the Directors in respect of the Annual FinancialReportThe Directors are responsible for keeping adequate accounting records that aresufficient to show and explain the Company's transactions and disclose withreasonable accuracy at any time the financial position of the Company andenable them to ensure that the Company's Financial Statements comply with theCompanies Act 2006 and Article 4 of the IAS Regulation. They are alsoresponsible for safeguarding the assets of the Company hence for takingreasonable steps for the prevention and detection of fraud and otherirregularities.The Directors are also responsible for preparing the Strategic Report, Reportof the Directors, the Directors Remuneration Report and Policy and theCorporate Governance Statement in accordance with the Companies Act 2006 andapplicable regulations including the requirements of 4.1.8R to 4.1.11R of theFCA's Disclosure and Transparency Rules and 3.35R of the Fund Sourcebook of theFCA Handbook.On behalf of the BoardThe Rt Hon Lord Waldegrave of North HillChairman21 May 2015Corporate Report / Depositary Report to the Directors of The Biotech GrowthTrust PLCThe DirectorsThe Biotech Growth Trust PLCOne Wood StreetLondonEC2V 7WS14 April 2015Statement of the Depositary's Responsibilities in Respect of the Scheme andReport of the Depositary to the Shareholders of The Biotech Growth Trust PLC("the Company") for the Period Ended 31 March 2015.The Depositary must take reasonable care to ensure that the Company is managedin accordance with the Financial Conduct Authority's Investment FundsSourcebook, ("the Sourcebook"), the Alternative Investment Fund ManagersDirective ("AIFMD") and the Company's Articles of Association (together "theRegulations").The Depositary must in the context of its role act honestly, fairly,professionally, independently and in the interests of the Company and itsinvestors.The Depositary is responsible for the safekeeping of the assets of the Companyin accordance with the Sourcebook.The Depositary must ensure that:the Company's cash flows are properly monitored and that cash of the Company isbooked in cash accounts in accordance with the Sourcebook;the sale, issue, repurchase, redemption and cancellation of shares are carriedout in accordance with the Regulations;the value of shares of the Company are calculated in accordance with theRegulations;the instructions of the Alternative Investment Fund Manager ("the AIFM") arecarried out (unless they conflict with the Regulations);any consideration relating to transactions in the Company's assets is remittedto the Company within the usual time limits; andthat the Company's income is applied in accordance with the Regulations.The Depositary also has a duty to take reasonable care to ensure that theCompany is managed in accordance with the Articles of Association in relationto the investment and borrowing powers applicable to the Company.Having carried out such procedures as we consider necessary to discharge ourresponsibilities as Depositary of the Company, it is our opinion, based on theinformation available to us and the explanations provided, that in all materialrespects the Company, acting through the AIFM has been managed in accordancewith the rules in the Sourcebook, the Articles of Association of the Companyand as required by the AIFMD.Sam MaybreyTrustee ManagerJ.P. Morgan Europe LimitedBournemouth14 April 2015Yours sincerelyJ.P. Morgan Europe Limited Chaseside, Bournemouth, Dorset, BH7 7DA. Switchboard (01202) 342000 Registered in England number 938937 at 25 Bank Street, Canary Wharf, London, E14 5JP. Authorised by the PRA and regulated by the FCA and PRA.Corporate Report / Independent Auditors' Report to the Members of The BiotechGrowth Trust PLCOpinion on financial statementsIn our opinion:the financial statements give a true and fair view of the state of theCompany's affairs as at 31 March 2015 and of the Company's net return for theyear then ended;the Company's financial statements have been properly prepared in accordancewith International Financial Reporting Standards as adopted by the EuropeanUnion;the Company's financial statements have been properly prepared in accordancewith International Financial Reporting Standards as adopted by the EuropeanUnion and as applied in accordance with the requirements of the Companies Act2006;the financial statements have been prepared in accordance with the requirementsof the Companies Act 2006Opinion on other matters prescribed by the Companies Act 2006In our opinion:the part of the Directors' Remuneration Report to be audited has been properlyprepared in accordance with the Companies Act 2006; andthe information given in the Strategic Report and Directors' Report for thefinancial year for which the financial statements are prepared is consistentwith the financial statements.What we have auditedWe have audited the financial statements of The Biotech Growth Trust PLC forthe year ended 31 March 2015 which comprise the Income Statement, the Statementof Changes in Equity, the Statement of Financial Position, the Statement ofCash Flows and the related notes 1 to 16. The financial reporting frameworkthat has been applied in their preparation is applicable law and InternationalFinancial Reporting Standards as adopted by the European Union.This report is made solely to the Company's members, as a body, in accordancewith Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has beenundertaken so that we might state to the Company's members those matters we arerequired to state to them in an auditor's report and for no other purpose. Tothe fullest extent permitted by law, we do not accept or assume responsibilityto anyone other than the Company and the Company's members as a body, for ouraudit work, for this report, or for the opinions we have formed.Respective responsibilities of directors and auditorAs explained more fully in the Directors' Responsibilities Statement thedirectors are responsible for the preparation of the financial statements andfor being satisfied that they give a true and fair view. Our responsibility isto audit and express an opinion on the financial statements in accordance withapplicable law and International Standards on Auditing (UK and Ireland). Thosestandards require us to comply with the Auditing Practices Board's EthicalStandards for Auditors.Scope of the audit of the financial statementsAn audit involves obtaining evidence about the amounts and disclosures in thefinancial statements sufficient to give reasonable assurance that the financialstatements are free from material misstatement, whether caused by fraud orerror. This includes an assessment of: whether the accounting policies areappropriate to the Company's circumstances and have been consistently appliedand adequately disclosed; the reasonableness of significant accountingestimates made by the directors; and the overall presentation of the financialstatements. In addition, we read all the financial and non-financialinformation in the Annual Report to identify material inconsistencies with theaudited financial statements and to identify any information that is apparentlymaterially incorrect based on, or materially inconsistent with, the knowledgeacquired by us in the course of performing the audit. If we become aware of anyapparent material misstatements or inconsistencies we consider the implicationsfor our report.Our assessment of risks of material misstatementWe identified the following risks of material misstatement that had thegreatest effect on the overall audit strategy; the allocation of resources inthe audit; and directing the efforts of the engagement team. The table alsoincludes our responses to the risks:Risk Identified Our ResponseThe valuation of the assets held in the We assessed the AIFM's and theinvestment portfolio is the key driver AIFM's appointed third partyof the company's investment return. The Administrator's systems and controlsportfolio is 99.41% comprised of listed in this area and decided not to relyinvestments. Incorrect asset pricing or on them for the first year of thea failure to maintain proper legal title audit.of the assets held by the company couldhave a significant impact on portfolio We obtained an understanding of thevaluation and, therefore, the return Company's valuation policy forgenerated for shareholders. investments held and confirmed that the values of the investments are recorded in line with it. For quoted investments, we agreed 100% of the year end prices to independent sources. For the unquoted investment, we have assessed the Company's valuation technique and confirmed the inputs used by checking to independent sources and obtaining confirmation from an independent source to confirm the fair value as at the year end date is in accordance with the Company's valuation policy.The performance fees payable by the We used the terms contained in thecompany for AIFM services are a AIFM and Portfolio Managerssignificant component of the company's Agreements to perform acost base and, therefore, impact the recalculation of the performancecompany's total return. As at 31 March fee.2015, the performance fee accrued was £1.8m (as disclosed in Note 3 to the We agreed the inputs used in thefinancial statements). calculation of the performance fee to source data.As described within the Report ofDirectors the calculation methodology We agreed the accounting treatmentfor performance fee accrued is adopted in relation to therelatively complex with a number of recognition of the fee wasinputs required from both external appropriate.sources and the company's own financialrecords.If the performance fee is not calculatedin accordance with the methodologydescribed in the AIFM and PortfolioManagement Agreements this could have asignificant impact on both costs andoverall performance.The Directors are responsible for We have reviewed revenue retained byensuring that the Company complies with the Company as a proportion ofthe investment trust conditions set out income received in compliance within section 1158 of the Corporation Taxes section s1158 CTA requirements.Act ("CTA") 2010 and the new InvestmentTrust (Approved Company) (Tax) We have reviewed the investmentRegulations 2011 and thus for monitoring policy to ensure consistency withmaintenance of investment trust status. initial application to ascertain compliance with s1158 CTA at the balance sheet date.Our application of materialityWe determined planning materiality for the Company to be £5.3 million which is1% of total equity. This provided a basis for determining the nature, timingand extent of our risk assessment procedures, identifying and assessing therisk of material misstatement and determining the nature, timing and extent offurther audit procedures. We have derived our materiality calculation based ona proportion of total equity as we consider it to be the most importantfinancial metric on which shareholders would judge the performance of theCompany.On the basis of our risk assessments, together with our assessment of theCompany's overall control environment, our judgment was that overallperformance materiality (i.e. our tolerance for misstatement in an individualaccount or balance) for the Company should be 50% of planning materiality,namely £2.6 million. Our objective in adopting this approach was to ensure thattotal undetected and uncorrected audit differences in all accounts did notexceed our planning materiality level.It was agreed with the Committee that all differences over £266,000 as well asdifferences below that threshold that, in our view, warranted reporting onqualitative grounds would be reported. No such differences were identified.We evaluate any uncorrected misstatements against both the qualitative measuresof materiality discussed above and in the light of other relevant qualitativeconsiderations.Matters on which we are required to report by exceptionWe have nothing to report in respect of the following:Under the ISAs (UK and Ireland), we are required to report to you if, in ouropinion, information in the Annual Report is:materially inconsistent with the information in the audited financialstatements; orapparently materially incorrect based on, or materially inconsistent with, ourknowledge of the Company acquired in the course of performing our audit; orotherwise misleading.In particular, we are required to consider whether we have identified anyinconsistencies between our knowledge acquired during the audit and theDirectors' statement that they consider the Annual Report is fair, balanced andunderstandable and whether the Annual Report appropriately discloses thosematters that we communicated to the Audit Committee which we consider shouldhave been disclosed.Under the Companies Act 2006 we are required to report to you if, in ouropinion:adequate accounting records have not been kept, or returns adequate for ouraudit have not been received from branches not visited by us; orthe financial statements and the part of the Directors' Remuneration Report tobe audited are not in agreement with the accounting records and returns; orcertain disclosures of Directors' remuneration specified by law are not made;orwe have not received all the information and explanations we require for ouraudit.Under the Listing Rules we are required to review:the Directors' statement in relation to going concern; andthe part of the Corporate Governance Statement relating to the Company'scompliance with the ten provisions of the UK Corporate Governance Codespecified for our review.ARMAJIT SINGHSENIOR STATUTORY AUDITORFOR AND ON BEHALF OF ERNST & YOUNG LLPSTATUTORY AUDITORLONDON21 May 2015Further Information / AIFMD Related DisclosureThe AIFM is required to make certain disclosures to prospective investors priorto their investment in the Company, in accordance with Article 23 AIFMD and3.2.2R and 3.2.3R of the FUND Sourcebook to the FCA Handbook. Each of thesedisclosures or an explanation of where they may be found in this Annual Reportor elsewhere is set out in this disclosure. In the period from 22 July 2014 to31 March 2015, there have been no material changes to this information, withthe exception of the increase in leverage limit which is disclosed under theheading "Periodic Disclosure".Investment Objective and LeverageA description of the investment strategy and objectives of the Company, thetypes of assets in which the Company may invest, the techniques it may employ,any applicable investment restrictions, the circumstances in which it may useleverage, the types and sources of leverage permitted and the associated risks,any restrictions on the use of leverage and the maximum level of leverage whichthe AIFM and Portfolio Manager are entitled to employ on behalf of the Companyand the procedures by which the Company may change its investments strategy and/or the investment policy can be found under the heading "Investment Objectiveand Policy".The table below sets out the current maximum permitted limit and actual levelof leverages for the Company: As a percentage of net assets Gross Commitment Method MethodMaximum level of leverage 130% 130%Actual level at 31 March 2015 109% 109%RisksThe principal risks associated with the investment strategy, objectives andtechniques of the Company and with the use of leverage by the Company arecontained under the heading "Risk Management". Shareholders and prospectiveinvestors should note that the risks summarised under "Risk Management" are therisks that the Board believes to be the most essential to an assessment ofwhether to invest in the Company. Shareholders may lose the value of theirinvestment in the Company for reasons other than those set out herein, forreasons not currently considered by the Board or based on circumstances orfacts of which the Board is not currently aware.Contractual Relationship with the CompanyA description of the main legal implications of the contractual relationshipentered into for the purpose of investment in the Company, includinginformation on jurisdiction and applicable law, is contained in the InvestorDisclosure Document (a copy of which can be viewed on the Company's websitewww.biotechgt.com).The articles between the Company's shareholders and the Company is governed byEnglish law and, by purchasing shares, investors agree that the Courts ofEngland have exclusive jurisdiction to settle any disputes. All communicationsin connection with the purchase of the Company's shares will be in English.Certain judgments obtained in EU member states (excluding Denmark at this time)in proceedings commenced on or after 10 January 2015, can be enforced inEngland and Wales under the Recast Brussels Regulation by obtaining acertificate from the court of origin certifying that the judgment isenforceable, serving the certificate and judgment on the judgment debtor and,when seeking enforcement, providing the courts of England and Wales with anauthenticated copy of the judgment and certificate and certifying compliancewith the requirements as to service on the debtor. The judgment debtor canapply for the enforcement of the judgment to be refused on limited grounds.Further, certain judgments obtained in EU member states (including Denmark) inproceedings commenced before 10 January 2015, or in Iceland, Norway andSwitzerland can be enforced in England and Wales under the 2001 BrusselsRegulation or the 2007 Lugano Convention and certain judgements obtained from acountry to which any of the Administration of Justice Act 1920, the ForeignJudgments (Reciprocal Enforcement) Act 1933 or the Civil Jurisdiction andJudgments Act 1982 applies can also be enforced in England and Wales by makingan application to the High Court for an order for registration of the judgmentfor enforcement. The judgment debtor may appeal/challenge registration onlimited grounds. It may also be possible to enforce a judgment obtained in acountry to which none of the above regimes apply in England and Wales if suchjudgment is: (1) final and conclusive on the merits; (2) given by a courtregarded by English law as competent to do so; and (3) for a fixed sum ofmoney.Details of Service ProvidersDetails of the AIFM, Portfolio Manager, Depositary, Auditor and other serviceproviders to the Company and their duties to the Company can be found under theheading "Company Management" and under the heading "External Auditor". Noshareholder, in their capacity as such, will generally have any directcontractual claim against any service provider to the Company with respect tosuch service provider's default of any of their duties towards the Company.Professional Liability RiskA description of how the AIFM complies with its obligations under the rules andregulations implementing the AIFMD (the "AIFM Rules") relating to professionalliability risk can be found under the heading "Alternative Investment FundManagement".Management Functions Delegated by AIFMA description of safe-keeping functions delegated by the Depositary, managementfunctions delegated by the AIFM and the identity of such delegates can be foundunder the headings "Company Management" and "Portfolio Management Agreement"respectively. The AIFM does not consider that any conflicts of interest arisefrom the delegation of its portfolio management function to OrbiMed, or fromthe delegation of the Depositary's safekeeping function to any sub-custodians.Valuation PolicyThe Company's portfolio of assets will be valued on each Dealing Day (a day onwhich the London Stock Exchange and banks in England and Wales are normallyopen for business). All instructions to issue or cancel ordinary shares givenfor a prior Dealing Day shall be assumed to have been carried out (and any cashpaid or received).The valuation will be based on the following:(a)Cash and amounts held in current and deposit accounts and in othertime-related deposits will be valued at their nominal value.(b)All transferable securities will be valued at fair value:(i)fair value for quoted investments is deemed to be bid market prices, or lasttraded price, depending on the convention of the exchange on which they arequoted; and(ii)unquoted investments are valued by the Directors using primary valuationtechniques such as discounted multiple of revenue.(c)All other property contained within the Company's portfolio of assets willbe priced at a value which, in the opinion of the AIFM, represents a fair andreasonable price (see below).(d)If there are any outstanding agreements to purchase or sell any of theCompany's portfolio of assets which are incomplete, then the valuation willassume completion of the agreement.(e)Added to the valuation will be:(i)any accrued and anticipated tax repayments of the Company;(ii)any money due to the Company because of ordinary shares issued prior to therelevant Dealing Day;(iii)income due and attributed to the Company but not received; and(iv)any other credit of the Company due to be received by the Company.Amounts which are de minimis may be omitted from the valuation.(f)Deducted from the valuation will be:(i)any anticipated tax liabilities of the Company;(ii)any money due to be paid out by the Company because of ordinary sharesbought back by the Company prior to the valuation;(iii)the principal amount and any accrued but unpaid interest on anyborrowings; and(iv)any other liabilities of the Company, with periodic items accruing on adaily basis.Amounts which are de minimis may be omitted from the valuation.Where the Company trades in investments where prices are not available on anexchange, quotations from brokers are utilised as follows:(i)where possible at least two quotations will be obtained; and(ii)the quotations should come from active participants in the market.Where only one quotation can be obtained the valuation will be considered inconjunction with other market-based observations such as comparable sources.Valuations of net asset value per ordinary share will be suspended only in anycircumstances in which the underlying data necessary to value the investmentsof the Company cannot readily or without undue expenditure be obtained. Anysuch suspension will be announced to a Regulatory Information Service.Liquidity Risk ManagementThe AIFM maintains a liquidity management policy to monitor the liquidity riskof the Company. Shareholders have no right to redeem their ordinary shares fromthe Company but may trade their ordinary shares on the secondary market.However, there is no guarantee that there is a liquid market in the ordinaryshares.Further details regarding the risk management process and liquidity managementare available from the AIFM, on request.FeesA description of certain of the fees, charges and expenses and of the maximumamounts thereof (to the extent that this can be assessed) which are borne bythe Company and thus indirectly by investors can be found under the heading"Company Management". In addition to these management, administration andsecretarial fees, the Company will pay all other fees, charges and expensesincurred in the operation of its business including, without limitation:brokerage and other transaction charges and taxes;Directors' fees and expenses;fees and expenses for custodial, registrar, legal, auditing and otherprofessional services;any borrowing costs;the ongoing costs of maintaining the listing of the ordinary shares and theircontinued admission to trading on the London Stock Exchange;directors and officers insurance premiums;promotional expenses (including membership of any industry bodies, includingthe AIC, and marketing initiatives approved by the Board); andcosts of printing the Company's financial reports and posting them toshareholders.Such fees and expenses are not subject to a maximum unit.Shareholders do not bear any fees, charges and expenses directly, other thanany fees, charges and expenses incurred as a consequence of acquiring,transferring, redeeming or otherwise selling ordinary shares.Remuneration of AIFM StaffFollowing completion of an assessment of the application of the proportionalityprinciple to the FCA's AIFM Remuneration Code, the AIFM has disapplied thepay-out process rules with respect to it and any of its delegates. This isbecause the AIFM considers that it carries out non-complex activities and isoperating on a small scale.Fair Treatment of InvestorsThe AIFM has procedures, arrangements and policies in place to ensurecompliance with the principles more particularly described in the AIFM Rulesrelating to the fair treatment of investors. The principles of treatinginvestors fairly include, but are not limited to:acting in the best interests of the Company and of the shareholders;ensuring that the investment decisions taken for the account of the Company areexecuted in accordance with the Company's investment policy and objective andrisk profile;ensuring that the interests of any group of shareholders are not placed abovethe interests of any other group of shareholders;ensuring that fair, correct and transparent pricing models and valuationsystems are used for the Company;preventing undue costs being charged to the Company and shareholders;taking all reasonable steps to avoid conflicts of interests and, when theycannot be avoided, identifying, managing, monitoring and, where applicable,disclosing those conflicts of interest to prevent them from adversely affectingthe interests of shareholders; andrecognising and dealing with complaints fairly.The AIFM maintains and operates organisational, procedural and administrativearrangements and implements policies and procedures designed to manage actualand potential conflicts of interest. In addition, as its ordinary shares areadmitted to the Official List, the Company is required to comply with, amongother things, the FCA's Listing Rules and Disclosure and Transparency Rules andthe Takeover Code, all of which operate to ensure a fair treatment ofinvestors. As at the date of this annual report, no investor has obtainedpreferential treatment or the right to obtain preferential treatment.Procedure and Conditions for the Issuance of Ordinary SharesThe Company's ordinary shares are admitted to the Official List of the UKLA andto trading on the main market of the London Stock Exchange. Accordingly, theCompany's ordinary shares may be purchased and sold on the main market of theLondon Stock Exchange.While the Company will typically have shareholder authority to buy back shares,shareholders do not have the right to have their shares purchased by theCompany.Net Asset ValueThe net asset value of the Company's ordinary shares is published daily by theAIFM via a Regulatory Information Service announcement.Historical performanceHistorical financial information demonstrating the Company's historicalperformance can be found within the Strategic Report. Copies of the Company'saudited accounts for the three financial years ended 31 March 2015 areavailable for inspection at the address of Frostrow and can be viewed on theCompany's website at www.biotechgt.com.The Prime BrokerJ.P. Morgan Clearing CorpThe services provided by J.P. Morgan Clearing Corp as Prime Broker to theCompany include:(a) safe-keeping of the assets of the Company that can be held in custody(including book entry securities);(b) the processing of transactions on behalf of the Company; and(c) the provision to the Company of an overdraft facility which is repayable ondemand. Up to 140% of the value of the outstanding overdraft can be taken ascollateral by the Prime Broker. Such assets may be used by the Prime Broker andsuch use may include their being loaned, sold, rehypothecated or transferred bythe Prime Broker.The AIFM does not consider that any conflicts of interest arise from theappointment of the Prime Broker.The Prime Broker is liable for the loss of the Company's financial instruments,the custody of which has been delegated to it by the Depositary.Transfer and reuse of the Company's AssetsThe Depositary may not use or re-use the Company's securities or otherinvestments without the prior consent of the Company.Discharge of Depositary LiabilityJP Morgan Europe Limited has discharged its liability under article 21(12) ofthe Directive in respect of its obligations under the first and secondparagraphs, of that article, regarding its liability for loss of financialinstruments held by the prime broker.Periodic DisclosuresNone of the Company's assets are subject to special arrangements arising fromtheir illiquid nature.No new arrangements have been implemented in order to manage the liquidity ofthe Company in the period running from 22 July 2014 to 31 March 2015.The maximum level of leverage which the AIFM is entitled to employ on behalf ofthe Company was increased to 130 per cent. under the gross end commitmentmethods with effect from 31 March 2015. The Company provided the requisitenotice to the FCA.Further disclosures required under the AIFM Rules can be found within theInvestor Disclosure Document on the Company's website: www.biotechgt.com.Further Information / Shareholder InformationFinancial Calendar31 March Financial Year EndMay Final Results Announced30 September Half Year EndNovember Half Year Results AnnouncedJuly Annual General MeetingAnnual General MeetingThe Annual General Meeting of The Biotech Growth Trust PLC will be held at theBarber Surgeons' Hall, Monkwell Square, Wood Street, London EC2Y 5BL onWednesday, 8 July 2015 at 12 noon.Share PricesThe Company's Ordinary Shares are listed on the London Stock Exchange under'Investment Companies'. The price is given daily in the Financial Times andother newspapers.Change of AddressCommunications with shareholders are mailed to the address held on the shareregister. In the event of a change of address or other amendment this should benotified to the Company's Registrars, Capita Asset Services, under thesignature of the registered holder.Daily Net Asset ValueThe daily net asset value of the Company's shares can be obtained on theCompany's website at www.biotechgt.com and is published daily via the LondonStock Exchange.Further Information / Glossary of Investment Trust TermsAICAssociation of investment companies.AIFMDThe Alternative Investment Fund Managers Directive (the "Directive") is aEuropean Union Directive that entered into force on 22 July 2013. The Directiveregulates EU fund managers that manage alternative investment funds (thisincludes investment trusts). There was a one-year transition period withinwhich alternative funds must comply with the provisions of the Directive.AIFMAIFMD and all applicable rules and regulations implementing AIFMD in the UK,including without prejudice to the generality of the foregoing the AlternativeInvestment Fund Managers Regulations 2013 (SI2013/1773) and all relevantprovisions of the FCA Handbook.Compound Annual Growth RateThe average year-on-year growth rate of an investment over a number of years.While investments usually do not grow at a constant rate, the compound annualreturn smoothes out returns by assuming constant growth.Discount or PremiumA description of the difference between the share price and the net asset valueper share. The size of the discount or premium is calculated by subtracting theshare price from the net asset value per share and is usually expressed as apercentage (%) of the net asset value per share. If the share price is higherthan the net asset value per share the result is a premium. If the share priceis lower than the net asset value per share, the shares are trading at adiscount.GearingCalculated using the Association of Investment Companies definition.Total assets, less current liabilities (before deducting any prior charges)minus cash/cash equivalents divided by Shareholders' Funds, expressed as apercentage.Initial Public Offering (IPO)The initial offer by a company of shares to be quoted on a stock exchange.Often known as a flotation.LeverageThe AIFM Directive (the "Directive") has introduced the obligation on theCompany and its AIFM in relation to leverage as defined by the Directive. TheDirective leverage definition is slightly different to the Association ofInvestment Companies method of calculating gearing and is as follows: anymethod by which the AIFM increases the exposure of an AIF it manages whetherthrough borrowing of cash or securities, or leverage embedded in derivativepositions.There are two methods for calculating leverage under the Directive - the GrossMethod and the Commitment Method. the process for calculating exposure undereach methodology is largely the same, except, where certain conditions are met,the Commitment Method enables instruments to be netted off to reflect 'netting'or 'hedging' arrangements and the entity exposure is effectively reduced.Net Asset Value (NAV)The value of the Company's assets, principally investments made in othercompanies and cash being held, less any liabilities. The NAV is also describedas 'shareholders' funds'. The NAV is often expressed in pence per share afterbeing divided by the number of shares which have been issued. The NAV per shareis unlikely to be the same as the share price which is the price at which theCompany's shares can be bought or sold by an investor. The share price isdetermined by the relationship between the demand and supply of the shares inthe secondary market.Ongoing ChargesOngoing charges are calculated by taking the Company's annualised ongoingcharges, excluding performance fees and exceptional items, and dividing by theaverage net asset value of the Company over the year.RehypothecationThe pledging of securities in a customer's margin account as collateral for aloan.Total AssetsTotal assets less current liabilities before deducting prior charges. Priorcharges includes all loans for investment purposes.Treasury SharesShares previously issued by a company that have been bought back fromShareholders to be held by the Company for potential sale or cancellation at alater date. Such shares are not capable of being voted and carry no rights todividends.Further Information / How to InvestInvestment PlatformsThe Company's shares are traded openly on the London Stock Exchange and can bepurchased through a stock broker or other financial intermediary. The sharesare available through savings plans (including Investment Dealing Accounts,ISAs, Junior ISAs and SIPPs) which facilitate both regular monthly investmentsand lump sum investments in the Company's shares. There are a number ofinvestment platforms that offer these facilities. A list of some of them, thatis not comprehensive nor constitutes any form of recommendation, can be foundbelow:AJ Bell Youinvest http://www.youinvest.co.uk/Alliance Trust http://www.alliancetrustsavings.co.uk/SavingsBarclays https://www.barclaysstockbrokers.co.uk/Pages/index.aspxStockbrokersCharles Stanley https://www.charles-stanley-direct.co.uk/DirectClub Finance http://www.clubfinance.co.uk/Fast Trade http://www.fastrade.co.uk/wps/portalFundsDirect http://www.fundsdirect.co.uk/Default.aspHalifax Share http://www.halifax.co.uk/Sharedealing/DealingHargreaves http://www.hl.co.uk/LansdownHSBC https://investments.hsbc.co.uk/iDealing http://www.idealing.com/IG Index http://www.igindex.co.uk/Interactive http://www.iii.co.uk/InvestorIWEB http://www.iweb-sharedealing.co.uk/share-dealing-home.aspJames Brearley http://www.jbrearley.co.uk/Marketing/index.aspxNatwest http://www.natweststockbrokers.com/nw/products-and-services/Stockbrokers share-dealing.ashxSaga Share Direct https://www.sagasharedirect.co.uk/Selftrade http://www.selftrade.co.uk/The Share Centre https://www.share.com/Saxo Capital http://uk.saxomarkets.com/MarketsTD Direct http://www.tddirectinvesting.co.uk/InvestingCapita Asset Services - Share Dealing ServiceA quick and easy share dealing service is available to existing shareholdersthrough the Company's Registrar, Capita Asset Services, to either buy or sellshares. An online and telephone dealing facility provides an easy to access andsimple to use service.There is no need to pre-register and there are no complicated forms to fill in.The online and telephone dealing service allows you to trade 'real time' at aknown price which will be given to you at the time you give your instruction.To deal online or by telephone all you need is your surname, shareholderreference number, full postcode and your date of birth. Your shareholderreference number can be found on your latest statement or certificate where itwill appear as either a 'folio number' or 'investor code'. Please have theappropriate documents to hand when you log on or call, as this information willbe needed before you can buy or sell shares.The maximum deal size for online trades is £25,000. Deals over this amount canbe done over the telephone and rates will be advised at the time of dealing.For further information on this service please contact: www.capitadeal.com(online dealing) or 0871 664 0364† (telephone dealing).If calling from outside of the UK please dial +44 (0) 203 367 2686† Calls cost 10p per minute plus network extras and may be recorded fortraining purposes. Lines are open from 8.00 a.m. to 4.30 p.m. Monday to Friday.RISK WARNINGSPast performance is no guarantee of future performance.The value of your investment and any income from it may go down as well as upand you may not get back the amount invested. This is because the share priceis determined, in part, by the changing conditions in the relevant stockmarkets in which the Company invests and by the supply and demand for theCompany's shares.As the shares in an investment trust are traded on a stock market, the shareprice will fluctuate in accordance with supply and demand and may not reflectthe underlying net asset value of the shares; where the share price is lessthan the underlying value of the assets, the difference is known as the'discount'. For these reasons, investors may not get back the original amountinvested.Although the Company's financial statements are denominated in sterling, all ofthe holdings in the portfolio are currently denominated in currencies otherthan sterling and therefore they may be affected by movements in exchangerates. As a result, the value of your investment may rise or fall withmovements in exchange rates.Investors should note that tax rates and reliefs may change at any time in thefuture.The value of ISA and Junior ISA tax advantages will depend on personalcircumstances. The favourable tax treatment of ISAs and Junior ISAs may not bemaintained.Further Information / Notice of the Annual General MeetingNotice is hereby given that the Annual General Meeting of The Biotech GrowthTrust PLC will be held at the Barber-Surgeons' Hall, Monkwell Square, WoodStreet, London EC2Y 5BL on Wednesday, 8 July 2015 at 12 noon, for the followingpurposes:Ordinary BusinessTo consider and, if thought fit, pass the following as ordinary resolutions:1.To receive and, if thought fit, to accept the Audited Financial Statementsand the Report of the Directors for the year ended 31 March 20152.To approve the Directors' Remuneration Report for the year ended 31 March20153.To re-elect The Rt Hon Lord Waldegrave of North Hill as a Director of theCompany4.To re-elect Professor Dame Kay Davies, DBE as a Director of the Company5.To re-elect Andrew Joy as a Director of the Company6.To re-elect Sven Borho as a Director of the Company7.To re-elect Peter Keen as a Director of the Company8.To re-appoint Ernst & Young LLP as Auditors to the Company and to authorisethe Audit & Management Engagement Committee to determine their remunerationSpecial BusinessTo consider and, if thought fit, pass the following resolutions of whichresolutions 10, 11, 12 and 13 will be proposed as special resolutions:Authority to Allot Shares9.THAT in substitution for all existing authorities the Directors be and arehereby generally and unconditionally authorised in accordance with Section 551of the Companies Act 2006 (the "Act") to exercise all powers of the Company toallot relevant securities (within the meaning of Section 551 of the Act) up toa maximum aggregate nominal amount of £1,579,668 (being 10% of the issued sharecapital of the Company at the date of the notice convening the meeting at whichthis resolution is proposed) and representing 6,318,673 shares of 25 pence each(or, if less, the number representing 10% of the issued share capital of theCompany at the date at which this resolution is passed), provided that thisauthority shall expire at the conclusion of the Annual General Meeting of theCompany to be held in 2016 or 15 months from the date of passing thisresolution, whichever is the earlier, unless previously revoked, varied orrenewed, by the Company in general meeting and provided that the Company shallbe entitled to make, prior to the expiry of such authority, an offer oragreement which would or might require relevant securities to be allotted aftersuch expiry and the Directors may allot relevant securities pursuant to suchoffer or agreement as if the authority conferred hereby had not expired.Disapplication of Pre-emption Rights10.THAT in substitution of all existing powers the Directors be and are herebygenerally empowered pursuant to Sections 570 and 573 of the Companies Act 2006(the "Act") to allot equity securities (within the meaning of section 560 ofthe Act) including if immediately before the allotment, such shares are held bythe Company as treasury shares (as defined in Section 724 of the Act) for cashpursuant to the authority conferred on them by resolution 11 set out in thenotice convening the Annual General Meeting at which this resolution isproposed or otherwise as if section 561(1) of the Act did not apply to any suchallotment and to sell relevant shares (within the meaning of section 560 of theAct) for cash as if section 561(1) of the Act did not apply to any such sale,provided that this power shall be limited to the allotment of equity securitiespursuant to:(a)an offer of equity securities open for acceptance for a period fixed by theDirectors where the equity securities respectively attributable to theinterests of holders of shares of 25 pence each in the Company ("Shares") areproportionate (as nearly as may be) to the respective numbers of Shares held bythem but subject to such exclusions or other arrangements in connection withthe issue as the Directors may consider necessary, appropriate, or expedient todeal with equity securities representing fractional entitlements or to dealwith legal or practical problems arising in any overseas territory, therequirements of any regulatory body or stock exchange, or any other matterwhatsoever; and(b)(otherwise than pursuant to sub-paragraph (a) above) up to an aggregatenominal value of £1,579,668 or, if less, the number representing 10% of theissued share capital of the Company at the date of the meeting at which thisresolution is passed,and expires at the conclusion of the next Annual General Meeting of the Companyafter the passing of this resolution or 15 months from the date of passing thisresolution, whichever is the earlier, unless previously revoked, varied orrenewed by the Company in general meeting and provided that the Company shallbe entitled to make, prior to the expiry of such authority, an offer oragreement which would or might require equity securities to be allotted aftersuch expiry and the Directors may allot equity securities pursuant to suchoffer or agreement as if the power conferred hereby had not expired.Authority to Repurchase Ordinary Shares11.THAT the Company be and is hereby generally and unconditionally authorisedin accordance with section 701 of the Companies Act 2006 (the "Act") to makeone or more market purchases (within the meaning of section 693(4) of the Act)of ordinary shares of 25 pence each in the capital of the Company ("Shares")either for retention as treasury shares for future reissue, resale, transfer orfor cancellation provided that:(a)the maximum aggregate number of Shares authorised to be purchased is9,471,691 (representing approximately 14.99% of the issued share capital of theCompany at the date of the notice convening the meeting at which thisresolution is proposed);(b)the minimum price (exclusive of expenses) which may be paid for a Share is25 pence;(c)the maximum price (exclusive of expenses) which may be paid for a Share isan amount equal to the greater of (i) 105% of the average of the middle marketquotations for a Share as derived from the Daily Official List of the LondonStock Exchange for the five business days immediately preceding the day onwhich that Share is purchased and (ii) the higher of the price of the lastindependent trade in shares and the highest then current independent bid forshares on the London Stock Exchange as stipulated in Article 5(1) of RegulationNo. 2233/2003 of the European Commission (Commission Regulation of 22 December2003 implementing the Market Abuse Directive as regards exemptions for buy-backprogrammes and stabilisation of financial instruments);(d)the authority hereby conferred shall expire at the conclusion of the AnnualGeneral Meeting of the Company to be held in 2016 or, if earlier, on the expiryof 15 months from the date of the passing of this resolution unless suchauthority is renewed prior to such time; and(e)the Company may make a contract to purchase Shares under this authoritybefore the expiry of such authority which will or may be executed wholly orpartly after the expiration of such authority, and may make a purchase ofShares in pursuance of any such contract.General Meetings12.THAT the Directors be authorised to call general meetings (other than annualgeneral meetings) on not less than 14 working days' notice, such authority toexpire at the conclusion of the next Annual General Meeting of the Company or,if earlier, until expiry of 15 months from the date of the passing of thisresolution.Articles of Association13.THAT the Articles of Association set out in the document produced to themeeting and signed by the Chairman of the meeting for the purposes ofidentification be and are hereby approved and adopted as the Articles ofAssociation of the Company in substitution for and to the exclusion of theexisting Articles of Association of the Company.Continuance of the Company14.To approve the Continuance of the Company as an investment trust for afurther period of five years.By order of the Board Registered office: One Wood StreetFrostrow Capital LLP London EC2V 7WSCompany Secretary21 May 2015Notes1. Members are entitled to appoint a proxy to exercise all or any of theirrights to attend and to speak and vote on their behalf at the meeting. Ashareholder may appoint more than one proxy in relation to the meeting providedthat each proxy is appointed to exercise the rights attached to a differentshare or shares held by that shareholder. A proxy need not be a shareholder ofthe Company. A proxy form which may be used to make such appointment and giveproxy instructions accompanies this notice.2. A vote withheld is not a vote in law, which means that the vote will not becounted in the calculation of votes for or against the resolutions. If novoting indication is given, a proxy may vote or abstain from voting at his/herdiscretion. A proxy may vote (or abstain from voting) as he or she thinks fitin relation to any other matter which is put before the meeting.3. To be valid any proxy form or other instrument appointing a proxy must becompleted and signed and received by post or (during normal business hoursonly) by hand at Capita Asset Services, PXS1, 34 Beckenham Road, Beckenham,Kent BR3 4ZF no later than 12 noon on 6 July 2015.4. In the case of a member which is a company, the instrument appointing aproxy must be executed under its seal or signed on its behalf by a dulyauthorised officer or attorney or other person authorised to sign. Any power ofattorney or other authority under which the instrument is signed (or acertified copy of it) must be included with the instrument.5. The return of a completed proxy form, other such instrument or any CRESTProxy Instruction (as described below) will not prevent a shareholder attendingthe meeting and voting in person if he/she wishes to do so.6. Any person to whom this notice is sent who is a person nominated undersection 146 of the Companies Act 2006 to enjoy information rights (a "NominatedPerson") may, under an agreement between him/her and the shareholder by whom he/she was nominated, have a right to be appointed (or have someone elseappointed) as a proxy for the meeting. If a Nominated Person has no such proxyappointment right or does not wish to exercise it, he/she may, under any suchagreement, have a right to give instructions to the shareholder as to theexercise of voting rights.7. The statement of the rights of shareholders in relation to the appointmentof proxies in paragraphs 1 and 3 above does not apply to Nominated Persons. Therights described in these paragraphs can only be exercised by shareholders ofthe Company.8. Pursuant to regulation 41 of the Uncertificated Securities Regulations2001, only shareholders registered on the register of members of the Company(the "Register of Members") at 5.30 p.m. on 6 July 2015 (or, in the event ofany adjournment, on the date which is two days before the time of the adjournedmeeting) will be entitled to attend and vote or be represented at the meetingin respect of shares registered in their name at that time. Changes to theRegister of Members after that time will be disregarded in determining therights of any person to attend and vote at the meeting.9. As at 21 May 2015 (being the last business day prior to the publication ofthis notice) the Company's issued share capital consists of 68,886,347 ordinaryshares (including 5,699,614 shares held in treasury), carrying one vote each.Therefore, the total voting rights in the Company as at 21 May 2015 are63,186,733.10. CREST members who wish to appoint a proxy or proxies through the CRESTelectronic proxy appointment service may do so by using the proceduresdescribed in the CREST Manual. CREST Personal Members or other CREST sponsoredmembers, and those CREST members who have appointed a service provider(s),should refer to their CREST sponsor or voting service provider(s), who will beable to take the appropriate action on their behalf.11. In order for a proxy appointment or instruction made using the CRESTservice to be valid, the appropriate CREST message (a "CREST ProxyInstruction") must be properly authenticated in accordance with thespecifications of Euroclear UK and Ireland Limited ("CRESTCo"), and mustcontain the information required for such instruction, as described in theCREST Manual. The message, regardless of whether it constitutes the appointmentof a proxy or is an amendment to the instruction given to a previouslyappointed proxy must, in order to be valid, be transmitted so as to be receivedby the issuer's agent (ID RA10) no later than 48 hours before the timeappointed for holding the meeting. For this purpose, the time of receipt willbe taken to be the time (as determined by the timestamp applied to the messageby the CREST Application Host) from which the issuer's agent is able toretrieve the message by enquiry to CREST in the manner prescribed by CREST.After this time any change of instructions to proxies appointed through CRESTshould be communicated to the appointee through other means.12. CREST members and, where applicable, their CREST sponsors, or votingservice providers should note that CRESTCo does not make available specialprocedures in CREST for any particular message. Normal system timings andlimitations will, therefore, apply in relation to the input of CREST ProxyInstructions. It is the responsibility of the CREST member concerned to take(or, if the CREST member is a CREST personal member, or sponsored member, orhas appointed a voting service provider, to procure that his CREST sponsor orvoting service provider(s) take(s)) such action as shall be necessary to ensurethat a message is transmitted by means of the CREST system by any particulartime. In this connection, CREST members and, where applicable, their CRESTsponsors or voting system providers are referred, in particular, to thosesections of the CREST Manual concerning practical limitations of the CRESTsystem and timings.13. The Company may treat as invalid a CREST Proxy Instruction in thecircumstances set out in Regulation 35(5)(a) of the Uncertificated SecuritiesRegulations 2001.14. In the case of joint holders, where more than one of the joint holderspurports to appoint a proxy, only the appointment submitted by the most seniorholder will be accepted. Seniority is determined by the order in which thenames of the joint holders appear in the Register of Members in respect of thejoint holding (the first named being the most senior).15. Members who wish to change their proxy instructions should submit a newproxy appointment using the methods set out above. Note that the cut-off timefor receipt of proxy appointments (see above) also applies in relation toamended instructions; any amended proxy appointment received after the relevantcut-off time will be disregarded.16. Members who have appointed a proxy using the hard-copy proxy form and whowish to change the instructions using another hard-copy form, should contactCapita Asset Services on 0871 664 0300 (calls cost 10p per minute plus networkextras). Lines are open 8.30am to 5.30pm Monday to Friday.17. If a member submits more than one valid proxy appointment, the appointmentreceived last before the latest time for the receipt of proxies will takeprecedence.18. In order to revoke a proxy instruction, members will need to inform theCompany. Members should send a signed hard copy notice clearly stating theirintention to revoke a proxy appointment to Capita Asset Services, PXS1, 34Beckenham Road, Beckenham, Kent BR3 4ZF.In the case of a member which is a company, the revocation notice must beexecuted under its common seal or signed on its behalf by an officer of thecompany or an attorney for the company. Any power of attorney or any otherauthority under which the revocation notice is signed (or a duly certified copyof such power of attorney) must be included with the revocation notice. If amember attempts to revoke their proxy appointment but the revocation isreceived after the time for receipt of proxy appointments (see above) then,subject to paragraph 4, the proxy appointment will remain valid. LOCATION OF THE ANNUAL GENERAL MEETING the Barber-Surgeons' Hall, Monkwell Square, Wood Street, London EC2Y 5BLFurther Information / Explanatory Notes to the ResolutionsResolution 1 - To receive the Annual Report and AccountsThe Annual Report and Accounts for the year ended 31 March 2015 will bepresented to the Annual General Meeting. These accounts accompanied this Noticeof Meeting and shareholders will be given an opportunity at the meeting to askquestions.Resolutions 2 - Remuneration ReportIt is now mandatory for all listed companies to put both their Report onDirectors' Remuneration and their Remuneration Policy to a shareholder vote.The Report on Directors' Remuneration Report is set out in full in this annualreport. The Remuneration Policy Report is required to be put to a shareholdervote at least once every three years. The report was last voted upon at the2014 Annual General Meeting.Resolutions 3 to 7 - Re-election of DirectorsResolutions 3 to 7 deal with the re-election of each Director. Biographies ofeach of the Directors can be found within the annual report.The Board has confirmed, following a performance review, that the Directorsstanding for election and re-election continue to perform effectively.Resolution 8 - Re-Appointment of Auditors and the determination of theirremunerationResolution 8 relates to the re-appointment of Ernst & Young LLP as theCompany's independent auditors to hold office until the next Annual GeneralMeeting of the Company and also authorises the Directors to set theirremuneration. Following the implementation of the Competition and MarketsAuthority order on Statutory Audit Services, which is effective for the Companyfrom 1 January 2015, only the Audit & Management Engagement Committee maynegotiate and agree the terms of the auditors' service agreement.Resolutions 9 and 10 - Issue of SharesOrdinary Resolution No. 9 in the Notice of Annual General Meeting will renewthe authority to allot the unissued share capital up to an aggregate nominalamount of £1,579,668 (equivalent to 6,318,673 shares, or 10% of the Company'sexisting issued share capital on 21 May 2015, being the nearest practicabledate prior to the signing of this Report). Such authority will expire on thedate of the next Annual General Meeting or after a period of 15 months from thedate of the passing of the resolution, whichever is earlier. This means thatthe authority will have to be renewed at the next Annual General Meeting.When shares are to be allotted for cash, Section 551 of the Companies Act 2006(the "Act") provides that existing shareholders have pre-emption rights andthat the new shares must be offered first to such shareholders in proportion totheir existing holding of shares. However, shareholders can, by specialresolution, authorise the Directors to allot shares otherwise than by a prorata issue to existing shareholders. Special Resolution No. 10 will, if passed,give the Directors power to allot for cash equity securities up to 10% of theCompany's existing share capital on 21 May 2015, as if Section 551 of the Actdoes not apply. This is the same nominal amount of share capital which theDirectors are seeking the authority to allot pursuant to Resolution No. 9. Thisauthority will also expire on the date of the next Annual General Meeting orafter a period of 15 months, whichever is earlier. This authority will not beused in connection with a rights issue by the Company.The Directors intend to use the authority given by Resolutions Nos. 9 and 10 toallot shares and disapply pre-emption rights only in circumstances where thiswill be clearly beneficial to shareholders as a whole. The issue proceeds wouldbe available for investment in line with the Company's investment policy. Noissue of shares will be made which would effectively alter the control of theCompany without the prior approval of shareholders in general meeting.Resolution 11 - Share RepurchasesThe Directors wish to renew the authority given by shareholders at the previousAnnual General Meeting. The principal aim of a share buy-back facility is toenhance shareholder value by acquiring shares at a discount to net asset value,as and when the Directors consider this to be appropriate. The purchase ofshares, when they are trading at a discount to net asset value per share,should result in an increase in the net asset value per share for the remainingshareholders. This authority, if conferred, will only be exercised if to do sowould result in an increase in the net asset value per share for the remainingshareholders and if it is in the best interests of shareholders generally. Anypurchase of shares will be made within guidelines established from time to timeby the Board. It is proposed to seek shareholder authority to renew thisfacility for another year at the Annual General Meeting.Under the current Listing Rules, the maximum price that may be paid on theexercise of this authority must not exceed the higher of (i) 105% of theaverage of the middle market quotations for the shares over the five businessdays immediately preceding the date of purchase and (ii) the higher of the lastindependent trade and the highest current independent bid on the trading venuewhere the purchase is carried out. The minimum price which may be paid is 25pper share. Shares which are purchased under this authority will either becancelled or held as treasury shares.Special Resolution No. 11 in the Notice of Annual General Meeting will renewthe authority to purchase in the market a maximum of 14.99% of shares in issueon 21 May 2015, being the nearest practicable date prior to the signing of thisReport, (amounting to 9,471,691 shares). Such authority will expire on the dateof the next Annual General Meeting or after a period of 15 months from the dateof passing of the resolution, whichever is earlier. This means in effect thatthe authority will have to be renewed at the next Annual General Meeting orearlier if the authority has been exhausted.Resolution 12 - General MeetingsSpecial Resolution No. 12 seeks shareholder approval for the Company to holdGeneral Meetings (other than the Annual General Meeting) at 14 clear days'notice.Resolution 13 - Amendment to Articles of AssociationIt is proposed to make certain changes to the Company's Articles of Associationto enable the Company to comply with its obligations under the OECD Standardfor Automatic Exchange for Financial Account Information (the "Common ReportingStandard"), United States Foreign Account Tax Compliance Act ("FATCA") andother exchange of tax information regimes which may be introduced.Resolution 14 - Continuance of the CompanyOrdinary Resolution No. 13 seeks shareholder approval for the Company tocontinue as an investment trust for a further period of five years.RecommendationThe Board considers that the resolutions relating to the above items of specialbusiness, are in the best interests of shareholders as a whole. Accordingly,the Board unanimously recommends to the shareholders that they vote in favourof the above resolutions to be proposed at the forthcoming Annual GeneralMeeting as the Directors intend to do in respect of their own beneficialholdings totaling 359,934 shares.Further Information / Explanatory Notes of Principal Changes to the Company'sArticles of AssociationIt is proposed that the Company adopts new Articles of Association (the"Articles") to enable it to comply with its obligations under the OECD Standardfor Automatic Exchange for Financial Account Information (the "Common ReportingStandard"), United States Foreign Account Tax Compliance Act ("FATCA") andother exchange of tax information regimes which may be introduced (together,the "Information Exchange Regimes").The Company is a reporting financial institution for the purposes of the CommonReporting Standard (which is expected to take effect from 1 January 2016) andFATCA (which already has effect).It is expected that the Company will have obligations under the CommonReporting Standard to conduct due diligence to identify applicable shareholderaccounts and to report certain information on its members to the UK taxauthorities for exchange with the tax authorities of other jurisdictions thatare signatories to the Common Reporting Standard.At present, due to an available exemption, it is not expected that the Companyshould have similar reporting obligations under FATCA. However, the law in thearea is developing and it is possible that the FATCA treatment of the Companymay change.For this reason, the Company is proposing that the Articles be amended toprovide that:each member of the Company shall cooperate with the Company in ensuring that itis compliant with the Information Exchange Regimes;each member of the Company shall provide the Company with such information,forms and documentation as may be requested by the Company for the purposes ofenabling the Company to comply with its obligations under the InformationSharing Regimes;each member consents to allowing, and authorises, the Company to disclose andsupply any information, forms or documentation in relation to it to theCommissioners for HM Revenue & Customs or any other relevant governmentalauthority of any jurisdiction to the extent required under the InformationExchange Regimes (and, to the extent relevant, shall procure that thebeneficial owner of the shares provides the same consent and authorisation);each member of the Company shall notify the Company of any changes toinformation provided by it to the extent that such information is required bythe Company for compliance with the Information Sharing Regimes;the Company may declare a member that fails to comply with the aboveobligations a "Non-Compliant Holder"; andto the extent moneys received or payable by the Company are subject todeduction or withholding pursuant to the Information Sharing Regimes, theCompany shall not be required to make good the members in respect of suchdeduction or withholding.The Company is also proposing that the Articles be amended to provide that, inthe event that a member is declared a Non-Compliant Holder, the directors maygive notice to such member requiring it to transfer its shares in the Companywithin 21 days. If the member does not transfer its shares within the 21 days,the Company may sell such member's shares on the member's behalf at the bestprice reasonably obtainable at the time.Further Information / Company InformationDirectorsThe Rt Hon Lord Waldegrave of North Hill (Chairman)Sven BorhoProfessor Dame Kay Davies, DBEPaul GauntAndrew Joy (Senior Independent Director and Chairman of the RemunerationCommittee)Peter Keen (Chairman of the Audit and Management Engagement Committee)Registered OfficeOne Wood StreetLondon EC2V 7WSWebsitewww.biotechgt.comCompany Registration Number3376377 (Registered in England)The Company is an investment company as defined under Section 833 of theCompanies Act 2006.The Company was incorporated in England on 20 May 1997. The Company wasincorporated as Reabourne Merlin Life Sciences Investment Trust PLC.Alternative Investment Fund Manager, Company Secretary and AdministratorFrostrow Capital LLP25 Southampton BuildingsLondon WC2A 1ALTelephone: +0203 008 4910E-Mail: info@frostrow.comWebsite: www.frostrow.comAuthorised and regulated by the Financial Conduct Authority.Portfolio ManagerOrbiMed Capital LLC601 Lexington Avenue, 54th FloorNew York NY10022 USATelephone: +1 212 739 6400Website: www.orbimed.comRegistered under the U.S. Securities and Exchange Commission.If you have an enquiry about the Company or if you would like to receive a copyof the Company's monthly fact sheet by e-mail, please contact Frostrow Capitalusing the stated e-mail address.Independent AuditorsErnst & Young LLP1 More London PlaceLondon SE1 2AFDepositaryJ.P. Morgan Europe Limited25 Bank StreetLondon E14 5JPPrime BrokerJ.P. Morgan Clearing Corp.Suite 1, Metro Tech RoadwayBrooklyn, NY11201USARegistrarsCapita Asset ServicesThe Registry34 Beckenham RoadBeckenhamKent BR3 4TUTelephone (in UK): 0871 664 0300†Telephone (from overseas): +44 20 8639 3399Facsimile: +44 (0) 1484 600911E-Mail: ssd@capitaassetservices.comWebsite: www.capitaassetservices.comPlease contact the Registrars if you have a query about a certificated holdingin the Company's shares.† calls cost 10p per minute plus network charges and may be recorded fortraining purposes. Lines are open from 8.30 a.m. to 5.30 p.m. Monday to Friday.Stock BrokerWinterflood Securities LimitedThe Atrium BuildingCannon Bridge25 Dow Gate HillLondon EC4R 2GASolicitorsDechert LLP160 Queen Victoria StreetLondon EC4V 4QIdentification CodesShares:SEDOL:0038551ISIN: GB0000385517BLOOMBERG: BIOG LNEPIC: BIOG21 May 2015020 3170 8732www.frostrow.comThe Annual Report will be posted to shareholders on Friday, 29 May 2015 Furthercopies may be obtained from Frostrow Capital LLP, the Company Secretary at 25Southampton Buildings, London WC2A 1AL.A copy of the Annual Report will be submitted to the National Storage Mechanismand will shortly be available for inspection at www.hemscott.com/nsm.do