Solactive is pleased to announce its latest collaboration with Korea Investment Management. The KIM ACE Eli Lilly Value Chain ETF aims to track the Solactive Eli Lilly Value Chain Index, offering investors strategic exposure to companies that form the extensive value chain surrounding Eli Lilly, a global leader in the pharmaceutical industry.
As the pharmaceutical industry continues to innovate, Eli Lilly plays a prominent role in the development of breakthrough treatments, including specialized drugs for Alzheimer’s disease, personalized medicine for cancer, and diabetes therapies.[1] Furthermore, regulatory shifts, such as accelerated FDA approvals, facilitate new market access and boost revenue growth potential of pharma companies including Eli Lilly.[2] In addition, Eli Lilly’s strategy of leveraging partnerships in both R&D and manufacturing reflects a broader trend in the healthcare sector that emphasizes the critical role of interconnected supply chains in developing effective healthcare solutions[3], highlighting the importance of focused investments in this field.
The Solactive Eli Lilly Value Chain Index is designed to track the performance of the top 15 key companies that maintain business partnerships with Eli Lilly, including Eli Lilly. These partnerships range from direct collaborations to indirect suppliers involved in Scientific Products, Healthcare and Pharma Industry Software, Outsourced Development and Manufacturing Services, and R&D in Biopharmaceuticals, as identified by a granular classification system. Furthermore, the index utilizes Solactive’s proprietary ARTIS® natural language processing technology to effectively screen for relevant R&D companies in vital sectors such as obesity treatments, diabetes (specifically GLP-1 therapies), and Alzheimer’s disease—areas where Eli Lilly is also actively engaged in—ensuring a portfolio that is highly pertinent and strategically aligned. Eli Lilly’s weight is fixed at 27.5%, while other portfolio constituents are weighted according to their free-float market capitalization with a 10% cap.
The ETF listed on 19th November on the Korean Stock Exchange with the ticker code 497520.KS.
Timo Pfeiffer, Chief Markets Officer at Solactive, commented: “We are excited to collaborate with Korea Investment Management on this innovative product with a carefully curated selection of highly relevant companies. Ongoing global health challenges and an ageing population increase the necessity of diverse healthcare solutions. Contributing towards this development, the Solactive Eli Lilly Value Chain Index provides access to the pharma giant’s robust supply chain and partnerships within the industry.”
Yongsoo Nam, Managing Director and Head of ETF Management at Korea Investment Management, commented: “In the past, large pharmaceutical companies conducted all stages of research, development, and production independently. However, with the expansion of the biopharmaceutical market, the growth of the CDMO industry and collaborations with biotechnology companies such as R&D have become increasingly prominent. The KIM ACE Eli Lilly Value Chain ETF focuses on Eli Lilly, which has a pipeline of next-generation key medicines in areas such as obesity and Alzheimer’s. The ETF also includes leaders in the CDMO, R&D, and essential hardware and software industries—key players in the pharma-bio ecosystem. Ultimately, the ETF aims to differentiate itself over the long term by investing in companies with high growth potential alongside Eli Lilly. As demonstrated by the launch of the KIM ACE Eli Lilly Value Chain ETF, ACE ETF seeks to continue building a diversified lineup of long-term growth prospects to help investors capitalize on industry growth.”
[1] 2024 Biopharma Outlook: 24 Trends, Innovations, and FDA’s Critical Role
[2] Eli Lilly Alzheimer’s Disease Treatment Approved by FDA, What to Know
[3] Pharma spends big to access key cell and gene therapy assets
