• Franco-Nevada for drug royalties.
• A REIT for biopharmaceutical royalties.

• Acquisition of Biopharmaceutical Royalties: Royalty Pharma purchases the rights to future royalty payments generated from the sales of approved and developing biopharmaceutical therapies.
• Funding Biopharmaceutical Innovation: The company provides capital and financing to innovators, including academic institutions, biotech companies, and pharmaceutical companies, to advance new biopharmaceutical therapies.

Royalty Pharma plc (RPRX) operates by acquiring royalty interests in biopharmaceutical therapies. As such, its primary revenue stream comes from royalty payments made by companies that market and sell these therapies. Therefore, Royalty Pharma's major customers are the:

• Pharmaceutical companies that market and sell therapies on which Royalty Pharma holds a royalty interest.
• Biotechnology companies that market and sell therapies on which Royalty Pharma holds a royalty interest.

The provided company description does not list the specific names of these customer companies that pay royalties to Royalty Pharma. Instead, it mentions that Royalty Pharma's portfolio consists of royalties on approximately 35 marketed therapies and 10 development-stage product candidates.

Pablo Legorreta, Founder, CEO and Chairman

Pablo Legorreta is the sole founder of Royalty Pharma, establishing the company in 1996 and pioneering its business model of acquiring pharmaceutical royalties. Prior to founding Royalty Pharma, he was an investment banker at Lazard Frères. Mr. Legorreta is also a co-founder of Pharmakon Advisors, a provider of debt capital to the life sciences industry, and ProKidney, LLC, a biotechnology company. He also founded and chairs Alianza Médica para la Salud, a non-profit organization. Royalty Pharma's early ownership was supported by high-net-worth individuals and family offices rather than traditional venture capital.

Terrance Coyne, Executive Vice President and Chief Financial Officer

Terrance Coyne joined Royalty Pharma in 2010 and was promoted to Chief Financial Officer in 2019. His career began at Wyeth Pharmaceuticals, and he later worked as a biotechnology analyst at J.P. Morgan and Rodman & Renshaw. Mr. Coyne has been instrumental in the acquisition of royalty assets for the company. He also serves on the Board of Trustees at La Salle University and the USATF Foundation Board of Directors.

George Lloyd, Senior Advisor

George Lloyd joined Royalty Pharma in 2011 as Executive Vice President, Investments, after advising the company on transactional work since 2006. He has also served as the company's General Counsel. Before joining Royalty Pharma, Mr. Lloyd was a partner in Goodwin Procter's Private Equity group and at Testa, Hurwitz & Thibeault, and an associate at Davis Polk & Wardwell. He previously served as the Chief Financial Officer and General Counsel for the Asian operations of a client, EF Education First, in Hong Kong from 2002 to 2003. His legal practice included providing general corporate representation for private equity firms.

Marshall Urist, Executive Vice President, Research and Investments

Marshall Urist joined RP Management, the external manager for Royalty Pharma, in 2013, before Royalty Pharma acquired its external manager in 2025. Previously, he worked at Morgan Stanley in equity research, where he was an Executive Director and a senior biotechnology analyst, covering life science tools and diagnostics sectors.

Susannah Gray, Executive Vice President – Finance & Strategy

Susannah Gray joined Royalty Pharma in 2005 as Chief Financial Officer. Effective March 15, 2019, she was named Executive Vice President – Finance & Strategy. She has been a key figure in funding Royalty Pharma's acquisition program and in shaping its strategic direction.

The key risks to Royalty Pharma's business model are primarily centered on the nature of its acquired royalty assets and the competitive landscape for such acquisitions.

1. Revenue Concentration and Loss of Exclusivity: Despite a diversified portfolio, a significant portion of Royalty Pharma's royalty receipts can be concentrated in a limited number of top-performing products or franchises. The loss of market exclusivity for these key products, whether due to patent expiration, the emergence of generic versions, or biosimilars, poses a substantial risk to the company's revenue streams. For instance, the anticipated loss of exclusivity for Promacta and the introduction of a biosimilar for Tysabri in the U.S. market are expected headwinds in 2026.

2. Reliance on Assumptions and Product Performance: Royalty Pharma's investment returns are highly dependent on long-term forecasts and assumptions regarding the sales performance of underlying biopharmaceutical products, their patent lives, and regulatory timelines. If these projections prove inaccurate, particularly for development-stage therapies, the actual cash flows from the acquired royalties may fall short of expectations, negatively impacting financial performance. The ultimate success of its investments is intrinsically linked to the uncertain clinical and commercial performance of the pharmaceutical products generating the royalties.

3. Competition and Risk of Overpaying for Royalties: As a major player in the biopharmaceutical royalty market, Royalty Pharma faces intense competition from other sophisticated buyers when acquiring royalty assets. This competition is particularly acute for royalties on approved or late-stage therapies, where clinical and regulatory risks are largely mitigated. Increased competition can drive up the acquisition prices for these assets, leading to a risk of overpaying. Overpaying for royalties can erode future returns if the acquired assets underperform sales expectations or face new competitive pressures.

The clear emerging threat for Royalty Pharma is the **intensifying competition from a growing number of sophisticated financial players for biopharmaceutical royalty assets and funding opportunities.**

As the biopharmaceutical royalty market has matured and demonstrated its attractiveness, an increasing number of private equity funds, specialized life sciences investment firms, and other institutional investors are entering this space. These new entrants often bring substantial capital and developing expertise, leading to heightened bidding competition for attractive royalty streams and funding deals. This trend can drive up acquisition prices for royalties, potentially compressing RPRX's margins and making it more challenging to source high-quality assets at favorable valuations. While not a technological disruption, this structural shift in the competitive landscape poses a significant threat to RPRX's ability to maintain its historical deal flow and profitability.

Royalty Pharma plc (RPRX) holds royalties on a diverse portfolio of biopharmaceutical therapies. The addressable markets for some of its main products or services are as follows:

• Vertex's Trikafta (Cystic Fibrosis franchise): The global sales for Trikafta were $11.02 billion in 2024. Projections indicate global sales could reach $10.5 billion by 2027. The broader global cystic fibrosis therapeutics market is projected to reach approximately USD 35.68 billion by 2035, growing at a CAGR of 9.9% from 2026 to 2035. Alternatively, some reports project the global cystic fibrosis therapeutics market to reach around USD 44.72 billion by 2035, with a CAGR of 14.24% between 2026 and 2035. North America was the dominant region in the cystic fibrosis therapeutics market in 2025.
• GSK's Trelegy (COPD/Asthma): Global sales for Trelegy Ellipta were approximately US$2.2 billion in 2023, with forecasts suggesting a rise to nearly US$3.8 billion by 2027. The global COPD and asthma therapeutics market was valued at USD 92.30 billion in 2024 and is estimated to reach USD 155.25 billion by 2030. North America held the largest revenue share of 40.1% in this market in 2024.
• Roche's Evrysdi (Spinal Muscular Atrophy - SMA): Evrysdi generated global revenues between $1.6 billion and $2.4 billion in 2024. Global sales are forecasted to reach $2.9 billion by 2031. The global SMA drugs market is projected to reach between USD 4 billion and USD 6 billion by 2025. The global spinal muscular atrophy treatment market size was estimated at USD 4.40 billion in 2024 and is projected to reach USD 13.09 billion by 2030. North America accounted for the highest revenue share of 68.4% in the spinal muscular atrophy treatment market in 2024.
• Johnson & Johnson's Tremfya (Psoriasis/Psoriatic Arthritis): The global Tremfya market size was estimated at USD 3.67 billion in 2024 and is projected to reach USD 7.29 billion by 2033, growing at a CAGR of 7.60% from 2025 to 2033. North America held the largest share of 85.46% of the global market in 2024. The U.S. Tremfya market size was valued at USD 2.41 billion in 2024 and is expected to reach USD 4.14 billion by 2032.
• AbbVie and Johnson & Johnson's Imbruvica (Blood Cancers): Imbruvica generated approximately USD 3.5 billion in global revenue in 2023, with U.S. revenue at approximately USD 2.6 billion in the same year. The global Imbruvica market size was estimated at USD 9698.2 million in 2024 and is expected to grow to USD 44462.00 million by 2031. North America holds a significant share of the Imbruvica market.
• Astellas and Pfizer's Xtandi (Prostate Cancer): Global end market sales for Xtandi were estimated at approximately $3.5 billion in 2019, with projections for growth to around $6.2 billion by 2026. Sales of Xtandi are forecasted to reach $5.59 billion in 2025. The global prostate cancer therapeutics market was valued at USD 12.6 billion in 2024 and is expected to reach USD 29.9 billion in 2034. North America accounted for the largest share of 39.2% in the prostate cancer therapeutics market in 2024.
• Pfizer's Nurtec ODT (Migraine): Global sales for Nurtec ODT were $835 million in 2024. Analysts project its annual sales to reach or exceed $1.5-2 billion within the next 3-5 years. The global migraine drugs market was valued at USD 6.59 billion in 2024 and is expected to reach USD 15.54 billion by 2032. The U.S. migraine drugs market was valued at USD 2.47 billion in 2024 and is expected to reach USD 5.80 billion by 2032.

Royalty Pharma (RPRX) is expected to drive future revenue growth over the next 2-3 years through several key strategies:

1. Growth of Existing Marketed Therapies: The company anticipates continued strong performance from its diversified portfolio of existing marketed therapies. Key products like the cystic fibrosis franchise, Trelegy, Tremfya, and Voranigo have been highlighted as significant contributors to portfolio receipts growth. While some therapies may face declines due to factors like loss of exclusivity or biosimilar launches (e.g., Promacta and Tysabri biosimilar), the overall strength and diversification of the portfolio are expected to provide a stable foundation for revenue expansion.
2. Acquisition of New Royalty Interests: A core driver for Royalty Pharma is its continuous acquisition of new royalty rights on biopharmaceutical products. The company has a robust transaction pipeline and actively deploys capital into new royalty opportunities, including synthetic royalty deals, which management views as a key growth area. For instance, in 2025, Royalty Pharma announced $4.7 billion in transactions and deployed $2.6 billion, acquiring interests in therapies such as Amgen's Imdeltra (cancer drug), Nuvalent's neladalkib and zidesamtinib (lung cancer), and the remaining royalty interest in Roche's Evrysdi. Funding agreements, like the one with Teva for TEV-'408 (vitiligo) and Zymeworks for Ziihera, also contribute to this expansion.
3. Advancement and Launch of Development-Stage Product Candidates: Royalty Pharma holds royalties on a pipeline of development-stage product candidates, and their successful progression and launch are crucial for future revenue. In 2025, significant milestones included FDA approval of Myqorzo and positive Phase 3 readouts for several therapies with potential for over $1 billion in peak annual sales, such as ecopipam, TEV-'749, and deucrictibant. Looking ahead to 2026, the company expects pivotal data readouts for potential blockbuster therapies like daraxonrasib, litifilimab, and pelacarsen, as well as anticipated FDA approval and launch of zidesamtinib. These pipeline catalysts are projected to contribute to top-line growth in the coming years and beyond.
4. Strategic Geographic Expansion: Royalty Pharma has identified expansion into new geographic markets, particularly China, as a significant growth opportunity. This strategic initiative is expected to contribute to the company's revenue outlook.

Share Repurchases

• In January 2025, Royalty Pharma's Board of Directors authorized a new $3 billion share repurchase program, replacing the unused $465 million from a prior $1 billion program announced in March 2023. The company intended to repurchase $2 billion of shares in 2025.
• During 2025, Royalty Pharma repurchased 37 million shares for approximately $1.2 billion.
• In 2024, the company repurchased approximately eight million Class A ordinary shares for $230 million.

Share Issuance

• In May 2025, Royalty Pharma Holdings Ltd., a subsidiary of Royalty Pharma, issued over 24.5 million non-voting Class E ordinary shares as part of the approximately $1.1 billion acquisition of its external manager, RP Management, LLC, which also included cash and assumed debt.

Outbound Investments

• Royalty Pharma consistently deploys significant capital into new royalty streams and strategic acquisitions, with total capital deployment reaching $2.6 billion in 2025, adding 9 new royalties to its portfolio.
• In 2024, the company deployed $2.8 billion of cash to acquire royalties, milestones, and other contractual receipts.
• Notable acquisitions in 2025 included a royalty interest in Amgen's Imdelltra for up to $950 million, a funding agreement on obexelimab with Zenas BioPharma for up to $300 million, and a royalty interest in Alnylam's Amvuttra for $310 million.

Capital Expenditures

• Royalty Pharma consistently reports negligible capital expenditures, often showing $0.00, over the last 3-5 years.
• This reflects the company's business model, which focuses on acquiring royalties and funding innovation in the biopharmaceutical industry rather than investing in physical assets.
• The company's free cash flow profitability has increased, indicating a less capital-intensive business model.