N-Q 1 healthcarefinal.htm BLACKROCK HEALTHCARE FUND healthcarefinal.htm - Generated by SEC Publisher for SEC Filing

UNITEDSTATES
SECURITIES AND EXCHANGECOMMISSION
Washington,D.C.20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-03595

Name of Fund: BlackRock Healthcare Fund, Inc.

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock
Healthcare Fund, Inc., 55 East 52nd Street, New York, NY 10055

Registrant’s telephone number, including area code: (800) 441-7762

Date of fiscal year end: 04/30/2011

Date of reporting period: 01/31/2011

Item 1 – Schedule of Investments


BlackRock Healthcare Fund, Inc.
Schedule of Investments January 31, 2011 (Unaudited)
(Percentages shown are based on Net Assets)

Common Stocks                                              Shares              Value
Biotechnology — 26.8%     
Actelion Ltd. (a)  115,000 $ 6,219,015 
Alexion Pharmaceuticals,     
Inc. (a)(b)  64,200  5,381,244 
Amgen, Inc. (a)  108,700  5,987,196 
Ariad Pharmaceuticals, Inc. (a)  75,000  478,125 
Basilea Pharmaceutica (a)  7,900  609,283 
Celgene Corp. (a)(b)  121,000  6,235,130 
Cephalon, Inc. (a)(b)  63,800  3,769,304 
Dendreon Corp. (a)(b)  88,900  3,115,056 
Genzyme Corp. (a)(b)  121,000  8,875,350 
Gilead Sciences, Inc. (a)(b)  180,000  6,908,400 
Human Genome Sciences,     
Inc. (a)(b)  468,000  11,353,680 
Onyx Pharmaceuticals, Inc. (a)(b)  104,600  3,690,811 
Vertex Pharmaceuticals,     
Inc. (a)(b)(c)  360,200  14,008,178 
76,630,772
Electronic Equipment, Instruments     
& Components — 0.8%     
Agilent Technologies, Inc. (a)(b)                               54,300       2,271,369
Health Care Equipment &     
Supplies — 10.2%     
Baxter International, Inc. (b)  50,000  2,424,500 
Beckman Coulter, Inc. (b)  118,600  8,540,386 
Covidien Plc  40,000  1,898,800 
Hologic, Inc. (a)  35,000  697,200 
Intuitive Surgical, Inc. (a)(b)  5,500  1,776,005 
Masimo Corp. (b)  178,000  5,335,550 
Medtronic, Inc. (b)  55,000  2,107,600 
Mindray Medical International     
Ltd. - ADR (b)  29,600  774,336 
NuVasive, Inc. (a)(b)  19,700  550,516 
Sirona Dental Systems, Inc. (a)(b)  39,500  1,730,495 
Smith & Nephew Plc  50,000  558,004 
St. Jude Medical, Inc. (a)  70,000  2,835,000 
29,228,392
Health Care Providers &     
Services — 29.8%     
AMERIGROUP Corp. (a)  800  41,896 
Aetna, Inc. (b)  197,500  6,505,650 
AmerisourceBergen Corp. (b)  292,100  10,474,706 
Cardinal Health, Inc. (b)  9,900  410,949 
Cigna Corp.  240,000  10,084,800 
Community Health Systems,     
Inc. (a)(b)  10,000  351,200 
Express Scripts, Inc. (a)(b)  175,200  9,869,016 
Health Management Associates,     
Inc., Class A (a)(b)  80,000  728,000 
Laboratory Corp. of America     
Holdings (a)  49,400  4,441,554 
McKesson Corp. (b)  19,700  1,480,849 

 

Common Stocks Shares Value
Health Care Providers & Services     
(concluded)     
Medco Health Solutions, Inc. (a)(b)  197,500 $ 12,051,450 
Omnicare, Inc. (b)  25,000  648,000 
PharMerica Corp. (a)  40,000  452,400 
Quest Diagnostics, Inc. (b)  64,200  3,656,190 
UnitedHealth Group, Inc. (b)  197,500  8,107,375 
Universal Health Services, Inc.,     
Class B  19,700  829,370 
WellCare Health Plans, Inc. (a)  97,500  2,915,250 
WellPoint, Inc. (a)(b)  197,500  12,268,700 
85,317,355
Health Care Technology — 2.5%     
Allscripts Healthcare Solutions,     
Inc. (a)                                                                  345,600        7,295,616
Internet Software & Services —     
6.1%     
WebMD Health Corp.,     
Class  A (a)(b)                                                        332,000      17,356,960
Life Sciences Tools & Services —     
1.7%     
Covance, Inc. (a)(b)  10,000  563,800 
Thermo Fisher Scientific, Inc. (a)  60,900  3,487,743 
Waters Corp. (a)  10,000  763,900 
4,815,443
Pharmaceuticals — 21.1%     
Abbott Laboratories  40,000  1,806,400 
Allergan, Inc. (b)  52,300  3,692,903 
Bristol-Myers Squibb Co.  57,000  1,435,260 
GlaxoSmithKline Plc  10,000  180,564 
Johnson & Johnson  80,000  4,781,600 
Merck & Co, Inc.  170,000  5,638,900 
Pfizer, Inc.  650,000  11,843,000 
Salix Pharmaceuticals Ltd. (a)  20,000  819,400 
Shire Pharmaceuticals Plc -     
ADR (b)  91,800  7,280,658 
Teva Pharmaceutical Industries     
Ltd. - ADR (b)  105,000  5,738,250 
Warner Chilcott Plc, Class A (b)  710,000  17,032,900 
 60,249,835
Total Long-Term Investments     
(Cost – $219,031,074) – 99.0%    283,165,742 
Short-Term Securities 
BlackRock Liquidity Funds,     
TempCash, Institutional Class,     
0.21% (d)(e)  48,497  48,497 

 

Portfolio Abbreviations

To simplify the listings of portfolio holdings in the Schedule of Investments, the names and descriptions of many of the securities have been abbreviated
according to the following list:

ADR  American Depository Receipts  JPY  Japanese Yen 
CHF  Swiss Franc  USD  US Dollar 

 

BLACKROCK HEALTHCARE FUND, INC. JANUARY 31, 2011 1


BlackRock Healthcare Fund, Inc.
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

  Beneficial   
  Interest   
Short-Term Securities  (000)  Value 
BlackRock Liquidity Series, LLC     
Money Market Series,     
0.42% (d)(e)(f)                                                     $ 4,000       $ 4,000,000

Total Short-Term Securities 		    
(Cost – $4,048,497) – 1.4%    4,048,497 
Total Investments Before Options Written     
(Cost – $223,079,571*) – 100.4%    287,214,239 

Options Written                                                 Contracts
Exchange-Traded Call Options —     
(0.2)%     
Aetna, Inc., Strike Price USD 33.00,     
Expires 2/19/11  200  (17,100) 
Agilent Technologies, Inc., Strike Price     
USD 43.00, Expires 2/19/11  55  (4,152) 
Alexion Pharmaceuticals, Inc., Strike     
Price USD 85.00, Expires 2/19/11  65  (15,925) 
Allergan, Inc., Strike Price USD 72.50,     
Expires 2/19/11  30  (2,325) 
AmerisourceBergen Corp., Strike Price     
USD 36.00, Expires 2/19/11  295  (23,600) 
Baxter International, Inc., Strike Price     
USD 52.50, Expires 2/19/11  50  (250) 
Beckman Coulter, Inc., Strike Price     
USD 80.00, Expires 2/19/11  130  (6,175) 
Cardinal Health, Inc., Strike Price USD     
40.00, Expires 2/19/11  10  (2,075) 
Celgene Corp., Strike Price USD     
62.50, Expires 2/19/11  210  (945) 
Cephalon, Inc., Strike Price USD     
65.00, Expires 2/19/11  60  (1,350) 
Cigna Corp., Strike Price USD 41.00,     
Expires 2/19/11  240  (41,760) 
Community Health Systems, Inc.,     
Strike Price USD 42.00, Expires     
2/19/11  10  (100) 
Covance, Inc., Strike Price USD 52.00,     
Expires 2/19/11  10  (4,612) 
Dendreon Corp., Strike Price USD     
40.00, Expires 2/19/11  90  (1,035) 
Express Scripts, Inc., Strike Price USD     
57.50, Expires 2/19/11  175  (18,025) 
Genzyme Corp., Strike Price USD     
72.50, Expires 2/19/11  121  (21,538) 
Gilead Sciences, Inc., Strike Price USD     
39.00, Expires 2/19/11  150  (7,875) 
Health Management Associates, Inc.,     
Class A, Strike Price USD 10.00,     
Expires 2/19/11  80  (600) 
Human Genome Sciences, Inc., Strike     
Price USD 26.00, Expires 2/19/11  730  (18,980) 
Intuitive Surgical, Inc., Strike Price     
USD 280.00, Expires 2/19/11  34  (150,110) 
Masimo Corp., Strike Price USD     
30.00, Expires 2/19/11  180  (18,000) 
McKesson Corp., Strike Price USD     
75.00, Expires 2/19/11  20  (4,200) 

 

 Options Written                                                 Contracts           Value
Exchange-Traded Call Options     
(concluded)     
Medco Health Solutions, Inc., Strike     
Price USD 65.00, Expires 2/19/11  200 $ (3,000) 
Medtronic, Inc., Strike Price USD     
38.00, Expires 2/19/11  55  (5,060) 
Mindray Medical International Ltd. –     
ADR, Strike Price USD 30.00,     
Expires 2/19/11  30  (150) 
NuVasive, Inc., Strike Price USD     
27.00, Expires 2/19/11  20  (3,647) 
Omnicare, Inc., Strike Price USD     
27.00, Expires 2/19/11  25  (625) 
Onyx Pharmaceuticals, Inc., Strike     
Price USD 40.00, Expires 2/19/11  100  (500) 
Quest Diagnostics, Inc., Strike Price     
USD 57.50, Expires 2/19/11  65  (5,530) 
Shire Pharmaceuticals Plc – ADR,     
Strike Price USD 75.00, Expires     
2/19/11  118  (57,230) 
Sirona Dental Systems, Inc., Strike     
Price USD 45.00, Expires 2/19/11  40  (4,500) 
Teva Pharmaceutical Industries     
Ltd. – ADR, Strike Price USD     
55.00, Expires 2/19/11  90  (9,405) 
UnitedHealth Group, Inc., Strike Price     
USD 40.00, Expires 2/19/11  200  (32,800) 
Vertex Pharmaceuticals, Inc., Strike     
Price USD 39.00, Expires 2/19/11  445  (47,838) 
Warner Chilcott Plc, Class A, Strike     
Price USD 24.00, Expires 2/19/11  719  (52,128) 
WebMD Health Corp., Class A, Strike     
Price USD 55.00, Expires 2/19/11  410  (11,275) 
WellPoint, Inc., Strike Price USD     
62.50, Expires 3/19/11  200  (41,000) 
Total Options Written     
(Premiums Received - $519,922) –     
(0.2)%    (635,420) 
Total Investments, Net of Outstanding Options     
Written – 100.2%    286,578,819 
Liabilities in Excess of Other Assets – (0.2)%    (610,432) 
Net Assets – 100.0%  $ 285,968,387 

* The cost and unrealized appreciation (depreciation) of investments as of
January 31, 2011, as computed for federal income tax purposes were as
follows:

Aggregate cost  $ 226,025,866 
Gross unrealized appreciation  $   65,102,604 
Gross unrealized depreciation  (3,914,231) 
Net unrealized appreciation  $   61,188,373 


(a) Non-income producing security.
(b) All or a portion of security has been pledged as collateral for outstanding
options written.
(c) Security, or a portion of security, is on loan.

2 BLACKROCK HEALTHCARE FUND, INC. JANUARY 31, 2011


BlackRock Healthcare Fund, Inc.
Schedule of Investments (concluded)

(d) Investments in companies considered to be an affiliate of the Fund
during the period, for purposes of Section 2(a)(3) of the Investment
Company Act of 1940, as amended, were as follows:

  Shares/    Shares/   
  Beneficial    Beneficial   
  Interest Held    Interest Held   
  at April 30,    at January 31,   
Affiliate  2010  Net Activity  2011  Income 
BlackRock         
Liquidity         
Funds,         
TempCash,         
Institutional         
Class  15,616,332  (15,567,835)  48,497  $ 5,130 
BlackRock         
Liquidity         
Series, LLC         
Money         
Market         
Series  $30,687,000 $(26,687,000)  $4,000,000  $17,800 


(e) Represents the current yield as of report date.
(f) Security was purchased with the cash collateral from loaned securities.

• For Fund compliance purposes, the Fund’s industry classifications refer
to any one or more of the industry sub-classifications used by one or
more widely recognized market indexes or rating group indexes, and/or
as defined by Fund management. This definition may not apply for
purposes of this report, which may combine such industry sub-
classifications for reporting ease.

• Foreign currency exchange contracts as of January 31, 2011 were as
follows:

Currency  Currency  Counter-      Settlement  Unrealized 
Purchased  Sold  party  Date  Depreciation 
USD 562,532 CHF  532,201  State  2/01/11 $ (1,240) 
    Street     
    Global     
    Markets,     
    LLC     
USD 1,000,035 JPY  82,345,773  State  2/02/11  (3,203) 
    Street     
    Global     
    Markets,     
    LLC     
Total      $ (4,443) 

 

• Fair Value Measurements - Various inputs are used in determining the fair
value of investments and derivatives, which are as follows:

• Level 1 — price quotations in active markets/exchanges for identical
assets and liabilities

• Level 2 — other observable inputs (including, but not limited to: quoted
prices for similar assets or liabilities in markets that are active, quoted
prices for identical or similar assets or liabilities in markets that are not
active, inputs other than quoted prices that are observable for the
assets or liabilities (such as interest rates, yield curves, volatilities,
prepayment speeds, loss severities, credit risks and default rates) or
other market-corroborated inputs)

• Level 3 — unobservable inputs based on the best information available
in the circumstances, to the extent observable inputs are not available
(including the Fund's own assumptions used in determining the fair
value of investments and derivatives)

The inputs or methodologies used for valuing securities are not necessarily
an indication of the risk associated with investing in those securities. For
information about the Fund's policy regarding valuation of investments and
derivatives and other significant accounting policies, please refer to the
Fund’s most recent financial statements as contained in its semi-annual
report.

The following tables summarize the inputs used as of January 31, 2011 in
determining the fair valuation of the Fund's investments and derivatives:

Valuation Inputs  Level 1  Level 2  Level 3  Total 
Assets:         
Investments in Securities:       
Biotechnology  $ 76,021,489  609,283  — $ 76,630,772 
Electronic         
Equipment,         
Instruments &         
Components  2,271,369  —  —  2,271,369 
Health Care         
Equipment &         
Supplies  28,670,388  558,004  —  29,228,392 
Health Care         
Providers &         
Services  85,317,355  —  —  85,317,355 
Health Care         
Technology  7,295,616  —  —  7,295,616 
Internet Software         
& Services  17,356,960  —  —  17,356,960 
Life Sciences         
Tools & Services  4,815,443  —  —  4,815,443 
Pharmaceuticals  60,069,271 $ 180,564  —  60,249,835 
Short-Term         
Securities  48,497  4,000,000  —  4,048,497 
Total  $281,866,388  $ 5,347,851  —  $ 287,214,239 

 

  Derivative Financial Instruments1   
Valuation Inputs  Level 1  Level 2  Level 3  Total 
Liabilities:         
Foreign currency         
exchange         
contracts  — $ (4,443)  — $ (4,443) 
Equity contracts…  $ (635,420)  —  —  (635,420) 
Total  $ (635,420) $ (4,443)  — $ (639,863) 

1 Derivative financial instruments are foreign currency exchange
contracts and options. Foreign currency exchange contracts are
shown at the unrealized appreciation/depreciation on the instrument
and options are shown at value.

BLACKROCK HEALTHCARE FUND, INC. JANUARY 31, 2011 3


Item 2 – Controls and Procedures

2(a) – The registrant's principal executive and principal financial officers or persons performing
similar functions have concluded that the registrant's disclosure controls and procedures (as
defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the
31940 Act3)) are effective as of a date within 90 days of the filing of this report based on the
evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act
and Rule 15d-15(b) under the Securities Exchange Act of 1934, as amended.

2(b) – There were no changes in the registrant's internal control over financial reporting (as defined
in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant's last fiscal quarter
that have materially affected, or are reasonably likely to materially affect, the registrant's
internal control over financial reporting.

Item 3 – Exhibits

Certifications – Attached hereto

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

BlackRock Healthcare Fund, Inc.

By: /S/ John M. Perlowski
John M. Perlowski
Chief Executive Officer (principal executive officer) of
BlackRock Healthcare Fund, Inc.

Date: March 25, 2011

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, this report has been signed below by the following persons on behalf
of the registrant and in the capacities and on the dates indicated.

By: /S/ John M. Perlowski
John M. Perlowski
Chief Executive Officer (principal executive officer) of
BlackRock Healthcare Fund, Inc.

Date: March 25, 2011

By: /S/ Neal J. Andrews
Neal J. Andrews
Chief Financial Officer (principal financial officer) of
BlackRock Healthcare Fund, Inc.

Date: March 25, 2011