- Last month, the ALPS Medical Breakthroughs ETF (SBIO) surged 10.51%, outpacing the Nasdaq Biotechnology Index’s 8.50% gain as investors rotated into small‑ and mid‑cap (SMid-cap) biotech on the back of strong clinical data, rising mergers and acquisitions (M&A) and growing confidence in further Federal Reserve (Fed) rate cuts. SBIO’s focused universe of US biotech companies with at least one drug in Phase II or III trials continues to concentrate exposure in the sector’s most catalyst‑rich names, while avoiding the very early‑stage cohort that can dominate headline risk. For investors looking to re‑engage with biotech as the asset class turns higher, SBIO offers a targeted way to own the part of the market where clinical data and deal flow still have the greatest potential to move stock prices.
- SBIO’s November strength was driven by a cluster of high‑profile movers across its SMid‑cap lineup. Notably, Terns Pharmaceuticals (TERN, 1.06% weight*) rallied 240.31% last month after releasing Phase I data for its chronic myeloid leukemia candidate, TERN‑701, which showed robust results and deep reductions in disease burden across heavily pre‑treated patients, with a clean safety profile that had analysts discussing best‑in‑class potential. Also moving higher within SBIO’s Cancer treatment segment, Olema Pharmaceuticals (OLMA, 0.81% weight*) jumped 215.72% in November after Roche (not in SBIO) reported successful Phase III results for its oral Selective Estrogen Receptor Degrader (SERD) in breast cancer treatment—the first large study to show a clear benefit versus standard endocrine therapy—prompting investors to reassess the opportunity for Olema’s own late‑stage oral SERD, Palazestrant, in metastatic breast cancer treatment. Adding to positive news catalysts, Nuvation Bio (NUVB, 1.17% weight*) gained 53.83% last month after management indicated they are in “very advanced” discussions with a potential ex‑US partner expected to be announced by year‑end, increasing the odds of non‑dilutive funding and broader reach for its oncology pipeline.
- Within SBIO’s Cardiology & Hematology treatment focus, Rigel Pharmaceuticals (RIGL, 0.37% weight*) gained nearly 60% last month following a strong third‑quarter update, posting double‑digit revenue growth across its hematology and oncology franchise and boosting full‑year guidance, reinforcing the view that its drug pipeline is transitioning from breakthrough ideas to cash‑generating treatments. Rounding out notable contributors, MBX Biosciences (MBX, 0.51% weight*) returned more than 57% in November as investors reacted to positive Phase II data for its once‑weekly hypoparathyroidism therapy, Canvuparatide, highlighting continued appetite for differentiated, late‑stage endocrine assets as the drug prepares for Phase III trials.
“Money is flowing into biotech now. Fast. Capital markets activity has picked up materially … and the pace of M&A takeouts is accelerating.”
– Stifel Biopharma Market Update, November 3, 2025
Biotech Catalysts: Easing Policy, Record Highs and Active Deal Flow
- November extended what has increasingly become a decisive shift in the backdrop for biotech. The Fed has shifted from hiking to cutting, and markets still expect more easing into 2026, which lowers borrowing costs and supports long‑duration growth stories like drug pipelines. The Nasdaq Biotechnology Index has responded positively and is up mid‑single digits over the past month and high‑teens over the past three months. SBIO has broken out to a new 52‑week high as funding conditions improve and investors rotate back into higher‑beta innovation. At the same time, 2025 biopharma M&A has already surpassed last year’s totals and is running ahead of historical averages, with tens of billions of dollars targeting oncology, immunology and rare‑disease platforms as large pharma looks to backfill pipelines ahead of a looming patent‑expiry wave.
- For investors, SBIO is built to tap directly into these trends rather than simply mirror broad biotech beta. SBIO’s portfolio focuses on US SMid-cap biotechs—roughly $200 million to $5 billion in market value—with at least one drug already in Phase II or III trials and generally two or more years of cash on hand, concentrating exposure in names with clear catalysts and less financing risk. That design has helped SBIO outperform the mega-cap heavy S&P 500 Index and large-cap-tilted biotech/pharma-focused S&P Biotechnology Select Industry Index over the last six months, with several SBIO holdings attracting acquisition bids at sizable premiums. In an environment where rate cuts and active dealmaking are improving the growth outlook for pure-play biotech investments, SBIO offers a more focused way to own late‑stage SMid‑cap breakthroughs compared to broader biotech vehicles that track the S&P Biotechnology Select Industry Index or NYSE Biotechnology Index.
- Over the last six months, SBIO has cumulatively returned +71.79%, outpacing the S&P Biotechnology Select Industry Index by over +16% and beating the S&P 500 by more than +55% over the same period. This strong performance reflects SBIO’s targeted, pure-play exposure to late‑stage SMid‑cap innovators as healthcare and biotech sentiment continues to improve.
Performance Summary
| Cumulative | Annualized |
|||||||||
| 1 M | YTD | 1 Y | 3 Y | 1 Y | 3Y | 5Y | 10Y | SI | ||
| SBIO - NAV (Net Asset Value) | 10.51% | 50.29% | 32.91% | 65.18% | 6.94% | 10.16% | -0.45% | 4.20% | 5.12% | |
| SBIO - Market Price | 10.58% | 51.11% | 32.96% | 65.72% | 6.97% | 10.19% | -0.42% | 4.22% | 5.12% | |
| S-Network Medical Breakthroughs Index - TR | 10.55% | 50.05% | 32.69% | 65.75% | 7.29% | 10.55% | -0.03% | 4.57% | 5.50% | |
| NASDAQ Biotechnology Index - TR | 8.50% | 35.96% | 26.28% | 37.25% | 3.19% | 9.90% | 3.58% | 5.09% | 4.70% | |
Source: Bloomberg L.P. and SS&C ALPS Advisors, cumulative performance as of 11/30/2025 and annualized performance as of 9/30/2025
Performance data quoted represents past performance. Past performance is no guarantee of future results so that shares, when redeemed, may be worth more or less than their original cost. The investment return and principal value will fluctuate. Current performance may be higher or lower than the performance quoted. For current month-end performance call 1-866-759-5679 or visit www.alpsfunds.com. Performance includes reinvested distributions and capital gains.
Market Price is based on the midpoint of the bid/ask spread at 4 p.m. ET and does not represent the returns an investor would receive if shares were traded at other times.
Fund inception date: 12/30/2014
Total Operating Expenses: 0.50%
* Weight in SBIO as of 11/30/2025
Top 10 Holdings
| Avidity Biosciences Inc | 4.47% | Merus NV | 3.00% | |
| Cytokinetics Inc | 3.41% | Nuvalent Inc | 2.98% | |
| Axsome Therapeutics Inc | 3.27% | PTC Therapeutics Inc | 2.80% | |
| Rhythm Pharmaceuticals Inc | 3.18% | Vaxcyte Inc | 2.67% | |
| Arrowhead Pharmaceuticals Inc | 3.04% | Krystal Biotech Inc | 2.58% |
As of 11/30/2025, subject to change
Important Disclosures & Definitions
An investor should consider the investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus containing this and other information, call 1-866-759-5679 or visit www.alpsfunds.com. Read the prospectus carefully before investing.
Shares of ETFs are bought and sold at market price (not NAV) and are not individually redeemable.
Performance data quoted represents past performance. Past performance is no guarantee of future results; current performance may be higher or lower than performance quoted.
All investments are subject to risks, including the loss of money and the possible loss of the entire principal amount invested. Additional information regarding the risks of this investment is available in the prospectus.
Diversification does not eliminate the risk of experiencing investment losses.
The Fund’s investments are concentrated in the pharmaceuticals and biotechnology industries, and underperformance in these areas will result in underperformance in the Fund. Investments in small and micro capitalization companies are more volatile than companies with larger market capitalizations. Companies in the pharmaceuticals and biotechnology industry may be subject to extensive litigation based on product liability and similar claims. Legislation introduced or considered by certain governments on such industries or on the healthcare sector cannot be predicted.
Companies in the pharmaceuticals industry are subject to competitive forces that may make it difficult to raise prices and, in fact, may result in price discounting. The profitability of some companies in the pharmaceuticals industry may be dependent on a relatively limited number of products. In addition, their products can become obsolete due to industry innovation, changes in technologies or other market developments. Many new products in the pharmaceuticals industry are subject to government approvals, regulation and reimbursement rates. The process of obtaining government approvals may be long and costly. Many companies in the pharmaceuticals industry are heavily dependent on patents and intellectual property rights. The loss or impairment of these rights may adversely affect the profitability of these companies.
The development of new drugs generally has a high failure rate, and such failures may negatively impact the stock price of the company developing the failed drug. Biotechnology companies may have persistent losses during a new product’s transition from development to production. In order to fund operations, biotechnology companies may require financing from the capital markets, which may not always be available on satisfactory terms or at all.
The Fund employs a “passive management” - or indexing - investment approach and seeks investment results that correspond (before fees and expenses) generally to the performance of its underlying index. Unlike many investment companies, the Fund is not “actively” managed. Therefore, it would not necessarily sell or buy a security unless that security is removed from or added to the underlying index, respectively.
NASDAQ Biotechnology Index: designed to track the performance of a set of securities listed on The NASDAQ Stock Market (NASDAQ) that are classified as either biotechnology or pharmaceutical companies and is a modified market capitalization weighted index.
NYSE Biotechnology Index: a rules-based, modified float-adjusted market capitalization-weighted equity index that has the objective of measuring the performance of US-listed companies in the biotechnology sector.
S&P Biotechnology Select Industry Index: comprises stocks in the S&P Total Market Index that are classified in the GICS biotechnology sub-industry.
S-Network Medical Breakthroughs Index: comprised of small and mid-cap stocks of biotechnology companies that have one or more drugs in either Phase II or Phase III of the US Food and Drug Administration (“FDA”) clinical trials.
S&P 500 Index: widely regarded as the best single gauge of large-cap US equities. The index includes 500 leading companies and covers approximately 80% of available market capitalization.
One may not invest directly in an index.
ALPS Advisors, Inc., registered investment adviser with the SEC, is the investment adviser to the Fund. ALPS Advisors, Inc. is affiliated with ALPS Portfolio Solutions Distributor, Inc.
ALPS Portfolio Solutions Distributor, Inc. is the distributor for the Fund.
Not FDIC Insured • No Bank Guarantee • May Lose Value
SMB000484 03/31/2026
