Baron Health Care Fund

Eli Lilly and Company (LLY) is a multinational pharmaceutical company developing drugs in diabetes, oncology, immunology, and neuroscience. The company's top-selling drugs include Mounjaro, Zepbound, Trulicity, Humalog, Alimta, Taltz, Humulin, and Jardiance.
We are investors in Lilly given its focus on industry-leading growth categories like diabetes, obesity, and oncology. Leading GLP-1 drugs Mounjaro and Zepbound offer superb blood sugar control for diabetics, can drive 20%-plus weight loss in obese patients, and are likely improve cardiovascular outcomes in both diabetic and non-diabetic obese patients. We think GLP-1 drugs will become the standard of care for both diabetes and obesity, representing a $150 billion-plus market. We believe Lilly has the potential to double revenues and achieve double-digit EPS growth by 2030.

Argenx SE (ARGX) is a biotechnology company developing antibodies for the treatment of autoimmune disorders. The company is in the early years of the commercial launch of its drug Vyvgart (efgartigimod alfa) for a rare muscle weakness disorder.
Efgartigimod has potentially broad applicability in ameliorating overactive antibody-based diseases. Efgartigimod is a true "pipeline in a product," where the product itself is the platform, as it has the potential to be used against a diverse range of diseases—something that is rarely achieved in the biotechnology space. We expect the share price to increase as argenx proves its product’s effectiveness in multiple autoantibody disorders.

Insmed Incorporated (INSM) is a biopharmaceutical company focused on developing therapies for rare and serious respiratory diseases. Its three lead drug candidates could collectively generate more than $8 billion in peak sales.
Insmed is advancing three late-stage drugs with combined peak sales potential above $8 billion. We are most excited about Brensocatib for non-cystic fibrosis bronchiectasis, a $5 billion-plus opportunity that could be transformative for 500,000 U.S. patients who lack approved therapies. We are also optimistic about treprostinil palmitil inhalation powder (TPIP) for pulmonary hypertension, a $3 billion opportunity. Unlike existing inhaled prostanoids, TPIP is administered once daily at higher levels, offering the potential for improved efficacy with fewer side effects.

Thermo Fisher Scientific Inc. (TMO) is the world's largest life sciences tools company. Thermo Fisher provides analytical instruments, laboratory equipment, software, services, consumables, and reagents for life sciences research, manufacturing, analysis, discovery, and diagnostics.
Thermo Fisher's $240 billion addressable market is growing 4% to 6% per year due to favorable demographics, scientific advances, new technology, and increased regulations. Long-term, management expects to grow revenue on an organic basis by 7% to 9% annually, driven by share gains and exposure to high-growth segments of the market. Competitive advantages include industry-leading scale, commercial infrastructure, e-commerce platform, supply chain capabilities, and R&D investment. The market is fragmented, offering opportunities to create shareholder value through M&A.

Arcellx, Inc. (ACLX) is a biotechnology company focused on cellular therapies. The company has a partnership with Kite, Gilead's cellular development and distribution unit that is widely considered state of the art in the industry.
Arcellx is developing a next-generation BCMA-targeted CAR-T cell therapy for multiple myeloma. We believe BCMA CAR-Ts could meaningfully transform treatment of this disease, which we estimate represents a $10 billion-plus market opportunity. Legend Biotech's competing drug, Carvykti, sets a high efficacy bar but has some neurological side effects. We think Arcellx's drug, on track to launch in 2026, has similar efficacy with a cleaner side-effect profile.

Boston Scientific Corporation (BSX) is a global developer, manufacturer, and marketer of medical devices used in a broad range of interventional medical specialties.
We believe Boston Scientific can grow organically by at least high single digits, driven by new product launches, which, in turn, should generate 50-plus basis points in margin growth and double-digits earnings growth annually. We think the combination of top-tier revenue growth and double-digit earnings growth will drive attractive returns in the years ahead.

AstraZeneca PLC (AZN) is a global biopharmaceutical company with a strategy based on pipeline-driven transformation and a focus on three main therapy areas based on its core competencies: oncology, cardiovascular and metabolic diseases, and respiratory illnesses.
We think AstraZeneca’s focused strategy could potentially produce a best-in-class growth profile. The company is a leader in economically attractive markets, particularly oncology, and has an opportunity to participate in emerging transformative markets, such as China's modernizing health care system. Current growth comes from multiple avenues as AstraZeneca is one of the rare companies to have pipeline optionality, new product cycles, and no existential loss of exclusivity risk for a key asset.

AbbVie Inc. (ABBV) is a diversified pharmaceutical company that develops and markets drugs across the autoimmune, oncology, neuroscience, and aesthetic therapeutic areas.
AbbVie is one of the strongest growth stories in pharmaceuticals, with Skyrizi and Rinvoq launching rapidly across a range of autoimmune conditions, including psoriasis, rheumatoid arthritis, and inflammatory bowel disease. Gastroenterologists are increasingly adopting both drugs for inflammatory bowel disease in particular, driving upside to near- and long-term estimates. We believe the two brands can nearly double revenues over the next five years, supporting mid- to high-single-digit revenue growth for the company overall. We view AbbVie as an attractive, diversified growth story.

Mettler-Toledo International Inc. (MTD) is a leading provider of precision instruments and services for customers in the life sciences, food, and chemical industries, among others.  
Mettler-Toledo has a track record of consistent growth. The company has strong brand recognition, customer diversification, pricing power, and margin expansion opportunities. We think the business has attractive financial characteristics, including high returns on capital, minimal capital requirements, and solid free cash flow generation, all of which it uses to repurchase its stock. We believe the management team is an excellent steward of capital and skilled at developing sales and marketing initiatives to enhance growth.

Stryker Corporation (SYK) is one of the world's leading medical technology companies, known for its orthopedic implants and the Mako robotic system. The company also offers a portfolio of medical, surgical, and neurovascular products.
We see Stryker as a high-quality compounder and anticipate long-term, high-single-digit revenue growth and double-digit EPS growth. Stryker is a leading innovator, with new product launches including the 1788 camera for enhanced endoscopy imaging, System 9 power tools, and Insignia muscle-sparing implants. We believe the company is poised to benefit from the growing shift of orthopedic procedures from hospitals to ambulatory surgical centers, where it is well positioned to leverage its unique Mako robotic system.

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