Samsung Active Asset Management Lists KoAct US Brain Disease Treatment Active ETF

Samsung Active Asset Management announced on the 3rd that it will list KoAct US Brain Disease Therapeutics Active as the seventh exchange-traded fund (ETF) under the ‘KoAct’ series.

KoAct US Brain Disease Therapeutics Active is the first domestic ETF to focus on investing in U.S. biotech companies developing treatments for brain diseases such as dementia, Parkinson’s, depression, schizophrenia, and epilepsy. Amid growing market interest in the biohealthcare sector, the fund plans to actively leverage the advantages of active-style management to concentrate investments in U.S. biotech companies related to brain diseases, including dementia treatments, which are expected to have high market growth potential.

As the global population’s life expectancy continues to increase and rapid aging progresses, forecasts predict a sharp rise in medical expenses related to brain disease treatments. Although the number of patients exposed to brain diseases has already been high, the brain’s status as the most complex structure in the body historically meant low clinical success rates. However, recent advancements in brain imaging and AI technology have significantly improved the drug development process and success rates for brain disease treatments, enabling the brain disease therapeutics market to enter a phase of substantial growth.

Accordingly, Samsung Active Asset Management expects the brain disease therapeutics field to establish itself as a new attractive investment theme within the biohealthcare sector, especially as blockbuster-level treatments are anticipated to be launched in this market. Major dementia treatments are expected to grow elevenfold over the next five years, and biotech companies related to brain diseases are likely to exhibit high volatility depending on the success of their new drug development projects. This underscores that active-style, agile investment management is more suitable for this area.

The portfolio of KoAct US Brain Disease Therapeutics Active consists of companies developing treatments for Alzheimer’s dementia, mental illnesses, and epilepsy, including Eli Lilly, Vertex, Biogen, Bristol-Myers Squibb, and Jazz Pharmaceuticals. The total expense ratio is 0.5% per annum.

Manager Jo Han-geut, who manages KoAct US Brain Disease Therapeutics Active, studied brain engineering at the University of Michigan and earned master’s degrees in bio and finance-related fields from Columbia and MIT. He joined Samsung Active Asset Management earlier this year and led the development of this product.

Seo Beom-jin, Head of Strategy Solutions at Samsung Active Asset Management, stated, “With the rapid advancement of brain imaging technology and AI, the brain disease therapeutics market is expected to grow dramatically. We have launched KoAct US Brain Disease Therapeutics Active to discover and proactively invest in innovative companies in this field.” He added, “By utilizing Samsung Active Asset Management’s solid corporate research and active management expertise, we will invest in and manage this product from a long-term perspective to generate excess returns.”