Royalty Pharma plc: Q4 FY2025 earnings call

What management said about Q4 FY2025, from the documents filed with the SEC on 11 February 2026: press release. Guidance figures: 5 new, 1 kept. The quarter’s numbers.

Key takeaways

Portfolio Receipts rose 16% for 2025: Portfolio Receipts were $874 million in the fourth quarter, up 18% from $742 million, and $3,254 million for 2025, up 16% from $2,801 million. Source
Operating cash flow lower for the year: Net cash from operating activities was $827 million in the fourth quarter, up 11% from $743 million, and $2,490 million for 2025, down 10% from $2,769 million. Source
Voranigo, Trelegy and Tremfya led growth: Fourth-quarter Royalty Receipts growth was primarily driven by Voranigo, Trelegy, Tremfya and the cystic fibrosis franchise. Voranigo reached $39 million from $5 million; Trelegy rose 28%; Tremfya rose 44%. Source
Management fee ended, lowering costs: Operating and professional costs were 8.9% of Portfolio Receipts in 2025 and are expected to fall in 2026, mainly because the management fee ended with internalization on May 16, 2025. Source
Capital deployment totaled $2.6 billion: Capital Deployment was $2,596 million for 2025 and $887 million in the fourth quarter, against $2,761 million for 2024. Source
Repurchases of $1.2 billion in 2025: Royalty Pharma repurchased 37 million Class A ordinary shares for $1.2 billion in 2025, including $75 million in the fourth quarter, under a program of up to $3.0 billion. Source
Obexelimab Phase 3 INDIGO positive: Zenas reported positive results from the Phase 3 INDIGO trial of obexelimab in IgG4-related disease, meeting the primary endpoint with a highly significant reduction in flare risk. Source

“We had one of the most remarkable years in Royalty Pharma’s history in 2025,”
Pablo Legorreta, Royalty Pharma’s Chief Executive Officer and Chairman of the Board

Guidance

Area	Period	Figure	Against last quarter
Portfolio Receipts Source	FY2026	$3,275 million to $3,425 million	New
Royalty Receipts growth Source	FY2026	3% to 8%	New
Payments for operating and professional costs Source	FY2026	5.5% to 6.5% of Portfolio Receipts	New
Interest paid Source	FY2026	$350 million to $360 million	Kept
Interest paid timing Source	Q1 and Q3 2026	approximately $175 million in each quarter; de minimis in Q2 and Q4	New
Foreign exchange effect on Portfolio Receipts Source	FY2026	approximately +1%	New

What changed from last quarter

New guidance: Full-year 2026 guidance for Portfolio Receipts, operating costs and interest paid was introduced in this release. Source
New: Funding agreement with Teva for TEV-'408 announced in January 2026, for up to $500 million. Source
New: Remaining Evrysdi royalties bought from PTC Therapeutics in December 2025, with a $240 million upfront payment and up to $60 million in sales milestones. Source
New: Royalty interest in Nuvalent's neladalkib and zidesamtinib acquired in December 2025 for up to $315 million, including a $155 million upfront payment. Source
New: Royalty interest in Denali's tividenofusp alfa agreed in December 2025 for up to $275 million, tied to FDA and EMA approval milestones. Source
New: Chief Executive Officer title now given with Chairman of the Board; the previous release described him as founder and Chief Executive Officer. Source

Results and growth

Portfolio Receipts rose 16% for 2025: Portfolio Receipts were $874 million in the fourth quarter, up 18% from $742 million, and $3,254 million for 2025, up 16% from $2,801 million. Source
Operating cash flow lower for the year: Net cash from operating activities was $827 million in the fourth quarter, up 11% from $743 million, and $2,490 million for 2025, down 10% from $2,769 million. Source
Adjusted EBITDA and cash flow measures rose: Fourth-quarter Adjusted EBITDA was $816 million, up 22%, and Portfolio Cash Flow was $815 million, up 20%. Both are non-GAAP liquidity measures under the credit agreement. Source

Product growth drivers

Voranigo, Trelegy and Tremfya led growth: Fourth-quarter Royalty Receipts growth was primarily driven by Voranigo, Trelegy, Tremfya and the cystic fibrosis franchise. Voranigo reached $39 million from $5 million; Trelegy rose 28%; Tremfya rose 44%. Source
Other products grew 43% in quarter: Other products, which include Crysvita, Emgality and Entyvio among others, reached $96 million in the fourth quarter, up 43%, and $381 million for 2025, up 15%. Source
Tysabri receipts fell over the year: Tysabri royalty receipts were $250 million for 2025, down 5% from $262 million, and $65 million in the fourth quarter, up 7%. Source

“We grew Portfolio Receipts by 16%, driven by the strength of our diversified portfolio, we returned a record amount of capital to shareholders and we deployed $2.6 billion on royalty transactions”
Pablo Legorreta, Royalty Pharma’s Chief Executive Officer and Chairman of the Board

Costs, interest and earnings

Management fee ended, lowering costs: Operating and professional costs were 8.9% of Portfolio Receipts in 2025 and are expected to fall in 2026, mainly because the management fee ended with internalization on May 16, 2025. Source
Interest paid rose sharply in 2025: Interest paid was $276 million for 2025, against $160 million in 2024. The 2026 projection is based on the note and term loan payment schedules. Source
Net income attributable to shareholders lower: Net income attributable to Royalty Pharma plc was $214 million in the fourth quarter, up from $208 million, and $771 million for 2025, down from $859 million. Source
Expected-cash-flow provision swung to benefit: The provision for changes in expected cash flows from financial royalty assets was a $296 million benefit for 2025, compared with a $732 million charge in 2024. Source

Capital deployment and royalty deals

Capital deployment totaled $2.6 billion: Capital Deployment was $2,596 million for 2025 and $887 million in the fourth quarter, against $2,761 million for 2024. Source
Royalties added on nine therapies: Royalties on nine therapies were added in 2025, including a Revolution Medicines partnership for Phase 3 daraxonrasib in pancreatic cancer. Announced transactions reached up to $4.7 billion. Source
Launch and R&D funding in fourth quarter: Fourth-quarter Capital Deployment also included Cytokinetics commercial launch funding and research and development funding for litifilimab. Source

“Looking ahead, our deal pipeline remains robust and we anticipate multiple events for our development-stage pipeline in 2026 - including pivotal study results for daraxonrasib, pelacarsen and litifilimab - that could unlock additional value.”
Pablo Legorreta, Royalty Pharma’s Chief Executive Officer and Chairman of the Board

Shareholder returns and balance sheet

Repurchases of $1.2 billion in 2025: Royalty Pharma repurchased 37 million Class A ordinary shares for $1.2 billion in 2025, including $75 million in the fourth quarter, under a program of up to $3.0 billion. Source
Quarterly dividend raised 7%: The quarterly dividend was $0.22 per share in 2025, equal to $512 million in dividends and distributions. It was raised 7% to $0.235 per share in the first quarter of 2026. Source
Cash and debt at year end: Cash and cash equivalents were $619 million at December 31, 2025, against total debt with principal value of $9.2 billion. Source
Diluted share count fell: Weighted-average diluted Class A shares were 564 million for 2025, down from 594 million. The fourth-quarter count was 556 million, down 6%. Source

Guidance assumptions

Guidance excludes later transactions: The 2026 guidance excludes transactions and borrowings announced after the release date, and assumes no major unforeseen adverse events. Source
No new debt assumed in projections: The interest projections assume no new debt in 2026, including no drawdown on the revolving credit facility. Source
Term loan rate tied to SOFR: The term loan assumed in the internalization carries a variable rate based on SOFR. The 2026 interest estimate uses the forward curve as of February 5, 2026. Source

Pipeline and portfolio milestones

Deucrictibant Phase 3 met primary endpoint: Pharvaris reported positive topline RAPIDe-3 data for deucrictibant, which met its primary endpoint and all secondary efficacy endpoints. Source
Obexelimab Phase 3 INDIGO positive: Zenas reported positive results from the Phase 3 INDIGO trial of obexelimab in IgG4-related disease, meeting the primary endpoint with a highly significant reduction in flare risk. Source
Daraxonrasib voucher speeds review: The FDA granted daraxonrasib a non-transferrable Commissioner's National Priority Voucher, which accelerates target review times to 1-2 months versus 6+ months. Source

Coming up, as management said on 11 February 2026

Litifilimab lupus Phase 3 data: Both litifilimab Phase 3 studies in systemic lupus erythematosus are fully enrolled, with data readouts expected in the second half of 2026. Source
Obexelimab BLA filing planned: Zenas anticipates submitting a Biologics License Application for obexelimab in the second quarter of 2026. Source
Obexelimab multiple sclerosis data: Zenas expects to report 24-week data for obexelimab in relapsing multiple sclerosis in the first quarter of 2026. Source
Deucrictibant filings in first half: Marketing authorization applications for deucrictibant are expected to be filed in the first half of 2026, based on RAPIDe-3 data. Source
Trodelvy first-line regulatory decisions: Gilead has submitted two supplemental BLAs for Trodelvy in first-line metastatic triple-negative breast cancer and expects regulatory decisions in 2026. Source
Teva vitiligo Phase 2b study: Royalty Pharma's $75 million co-funding of a Phase 2b vitiligo study for TEV-'408 is targeted for 2026. Source
Cobenfy ADEPT-2 results timing: The ADEPT-2 study of Cobenfy in psychosis associated with Alzheimer's disease will continue, with results expected by the end of 2026. Source

Figures management reported

Figure	Reported
Royalty Receipts Source	$856 million in Q4 (up 17%); $3,127 million in 2025 (up 13%)
Cystic fibrosis franchise royalty receipts Source	$251 million in Q4 (up 6%); $917 million in 2025 (up 7%)
Imdelltra approval Source	Full FDA approval for extensive-stage small cell lung cancer, November 2025
Myqorzo approval Source	FDA approval for obstructive hypertrophic cardiomyopathy, December 2025
TEV-'749 regulatory filing Source	New Drug Application submitted to FDA, December 2025 (olanzapine LAI)
Trodelvy ASCENT-07 Phase 3 readout Source	Primary endpoint of progression-free survival not met, November 2025
Tysabri biosimilar launch Source	Tyruko U.S. launch, November 2025
Research and development funding expense Source	$452 million in 2025 (2024: $2 million)

Risks management discussed

Demand: Promacta royalty receipts declined after U.S. generic competition launched in May 2025; fourth-quarter Promacta receipts were $27 million, down 38%. Source
Financial: Covenant noncompliance under the credit agreement could lead lenders to require immediate repayment of all amounts borrowed. Source
External: The guidance assumes current foreign exchange rates continue for the rest of 2026, so exchange rate changes would affect the estimate. Source

Earlier plans management reported on

On track: In November 2025 management said it was on track for double-digit top-line growth in 2025.

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

Royalty Pharma plc

2026 Financial Outlook Portfolio Receipts Highlights Liquidity and Capital Resources The table below details Capital Deployment by category: Key Developments Relating to the Portfolio Financial Results Call Portfolio Receipts Royalty Pharma plc Royalty Pharma plc Royalty Pharma plc Royalty Pharma plc Royalty Pharma plc Notes ROYALTY PHARMA REPORTS Q4 AND FULL YEAR 2025 RESULTS Consolidated Statements of Cash Flows (unaudited) Condensed Consolidated Statements of Operations (unaudited) Selected Balance Sheet Data (unaudited) GAAP to Non-GAAP Reconciliation (unaudited) Fourth Quarter and Full Year Portfolio Receipts Highlights (unaudited) Description of Approved Indications for Select Portfolio Therapies Three Months Ended December 31,(unaudited)($ in millions)20252024ChangeProducts:Marketers:Therapeutic Area:Cystic fibrosis franchiseVertexRare disease2512376%TrelegyGSKRespiratory957428%TysabriBiogenNeuroscience65617%EvrysdiRocheRare disease645615%TremfyaJohnson & JohnsonImmunology563944%XtandiPfizer, AstellasOncology534616%ImbruvicaAbbVie, Johnson & JohnsonOncology4046(13)%VoranigoServierOncology395*PromactaNovartisHematology2744(38)%Cabometyx/CometriqExelixis, Ipsen, TakedaOncology222013%SpinrazaBiogenRare disease1415(4)%ErleadaJohnson & JohnsonOncology131118%TrodelvyGileadOncology12118%ImdelltraAmgenOncology10 - n/aOther products(6)966743%Royalty Receipts85672917%Milestones and other contractual receipts181342%Portfolio Receipts87474218% Table 3 Royalty Pharma has provided guidance for full year 2026, excluding new transactions and borrowings announced after the Royalty Pharma’s liquidity and capital resources are summarized below: The key developments related to Royalty Pharma’s royalty interests are discussed below based on disclosures from the Royalty Pharma will host a conference call and simultaneous webcast to discuss its fourth quarter and full year 2025 results Portfolio Receipts is a key performance metric that represents Royalty Pharma’s ability to generate cash from Royalty (1)Portfolio Receipts is defined above in the section entitled “Portfolio Receipts.” Capital Deployment

Table 1 Table 2 Table 4 Table 5 Table 6

Portfolio Receipts of $874 million in Q4 2025 and $3,254 million for FY 2025 date of this release, as follows: marketers of the products. today at 8:00 a.m., Eastern Time. Please visit the “Investors” page of the company’s website at https:// Pharma’s portfolio investments, the primary source of capital that is deployed to make new portfolio investments. Portfolio Three Months Ended December 31,Twelve Months Ended December 31,(unaudited)($ in millions)2025202420252024Purchases of available for sale debt securities(100) - (175)(150)Acquisitions of financial royalty assets(734)(496)(1,698)(2,506)Acquisitions of other financial assets - - - (18)Development-stage funding payments(51)(1)(452)(2)Milestone payments(3)(25)(271)(75)Investments in equity method investees - - - (11)Contributions from legacy non-controlling interests - R&D - 001Capital Deployment(887)(522)(2,596)(2,761) (2)Adjusted EBITDA is defined under the credit agreement as Portfolio Receipts minus payments for operating and professional costs. Operating and As of December 31, 2025, Royalty Pharma had cash and cash equivalents of $619 million and total debt with principal value Three Months Ended December 31,Twelve Months Ended December 31,($ in millions)2025202420252024Cash flows from operating activities:Cash collections from financial royalty assets9167773,3552,983Cash collections from intangible royalty assets00115Other royalty cash collections2930114109Distributions from equity method investees - - 1313Interest received693446Development-stage funding payments(51)(1)(452)(2)Payments for operating and professional costs(58)(72)(288)(236)Payments for Employee EPAs(9) - (11) - Interest paid(7)(1)(276)(160)Net cash provided by operating activities8277432,4902,769Cash flows from investing activities:Acquisition of businesses, net of cash acquired - - (74) - Distributions from equity method investees5310524Investments in equity method investees - - - (11)Purchases of equity securities(54) - (58)(63)Proceeds from equity securities35 - 3599Purchases of available for sale debt securities(100) - (175)(150)Proceeds from available for sale debt securities3132120Proceeds from sales of available for sale debt securities - - 511 - Acquisitions of financial royalty assets(734)(496)(1,698)(2,506)Acquisitions of other financial assets - - - (18)Milestone payments(3)(25)(271)(75)Other - - (9)2Net cash used in investing activities(848)(506)(1,614)(2,678)Cash flows from financing activities:Distributions to legacy non-controlling interests - Portfolio Receipts(79)(81)(355)(362)Distributions to continuing non-controlling interests(41)(31)(167)(125)Dividends to shareholders(94)(94)(378)(376)Repurchases of Class A ordinary shares(81)(53)(1,227)(230)Contributions from legacy non-controlling interests - R&D - 001Contributions from non-controlling interests - other - 164Proceeds from revolving credit facility - - 1,275 - Repayment of revolving credit facility - - (1,275) - Repayment of long-term debt - - (1,000) - Proceeds from issuance of long-term debt, net of discount - - 1,9541,471Debt issuance costs and other(3)0(17)(13)Other(2)0(2)(9)Net cash (used in)/provided by financing activities(300)(257)(1,186)361Net change in cash and cash equivalents(320)(20)(310)452Cash and cash equivalents, beginning of period939950929477Cash and cash equivalents, end of period619929619929
Portfolio Receipts growth of 18% in Q4 2025 and 16% for FY 2025 www.royaltypharma.com/investors/events to obtain conference call information and to view the live webcast. A replay of Receipts is defined as the sum of Royalty Receipts and Milestones and other contractual receipts. Royalty Receipts includes professional costs reflect Payments for operating and professional costs from the GAAP consolidated statements of cash flows. See GAAP to Non- Provided February 11, 2026Portfolio Receipts$3,275 million to $3,425 millionPayments for operating and professional costs5.5% to 6.5% of Portfolio ReceiptsInterest paid$350 million to $360 million Three Months Ended December 31,Twelve Months Ended December 31,($ in millions)2025202420252024Income and other revenuesIncome from financial royalty assets5925622,2612,149Other royalty income and revenues3032117114Total income and other revenues6225942,3782,264Operating expense/(income)Provision for changes in expected cash flows from financial royalty assets23164(296)732Provision for credit losses on unfunded commitments(4) - 89 - Research and development funding expense5114522General and administrative expenses (includes 126, 291, 1, and 3 of share-based compensation expense for the three months and twelve months ended December 31, 2025 and 2024, respectively)16468573237Total operating expense, net234232819971Operating income3883621,5601,292Other (income)/expenseEquity in earnings of equity method investees(4)(32)(29)(30)Interest expense9466308226Other income, net(58)(7)(43)(234)Total other expense/(income), net3227235(38)Consolidated net income before tax3563341,3241,331Income tax expense - - - - Consolidated net income3563341,3241,331Net income attributable to non-controlling interests142126553472Net income attributable to Royalty Pharma plc214208771859 ($ in millions)As of December 31, 2025As of December 31, 2024Cash and cash equivalents619929Total current and non-current financial royalty assets, net17,06315,911Total assets19,62118,223Current portion of long-term debt380998Long-term debt, net of current portion8,5716,615Total liabilities9,9067,880Total shareholders’ equity9,71510,342 Three Months Ended December 31,Twelve Months Ended December 31,($ in millions)2025202420252024Net cash provided by operating activities (GAAP)8277432,4902,769Adjustments:Proceeds from available for sale debt securities(7)3132120Distributions from equity method investees(7)5310524Interest paid/(received), net(7)0(8)242113Development-stage funding payments5114522Distributions to legacy non-controlling interests - Portfolio Receipts(7)(79)(81)(355)(362)Payments for Employee EPAs9 - 11 - Adjusted EBITDA (non-GAAP)8166692,9662,565 Interest (paid)/received, net(7)(0)8(242)(113)Portfolio Cash Flow (non-GAAP)8156782,7242,452 Three Months Ended December 31,Twelve Months Ended December 31,($ in millions)20252024Change20252024ChangeProducts:Cystic fibrosis franchise2512376%9178577%Trelegy957428%33228417%Tysabri65617%250262(5)%Evrysdi645615%20217416%Xtandi534616%19716917%Tremfya563944%17814028%Imbruvica4046(13)%170191(11)%Promacta2744(38)%142158(11)%Voranigo395*1185*Cabometyx/Cometriq222013%857316%Spinraza1415(4)%524517%Trodelvy12118%47438%Erleada131118%463918%Imdelltra10 - n/a10 - n/aOther products(6)966743%38133315%Royalty Receipts85672917%3,1272,77113%Milestones and other contractual receipts181342%12831314%Portfolio Receipts87474218%3,2542,80116% Cystic fibrosis franchiseCystic fibrosisTrelegyChronic obstructive pulmonary disease and asthmaTysabriRelapsing forms of multiple sclerosisEvrysdiSpinal muscular atrophyTremfyaPlaque psoriasis, psoriatic arthritis, ulcerative colitis and Crohn’s diseaseXtandiProstate cancerImbruvicaHematological malignancies and chronic graft versus host diseaseVoranigoLow-grade gliomaPromactaChronic immune thrombocytopenia purpura and aplastic anemiaCabometyx/CometriqKidney, liver and thyroid cancerSpinrazaSpinal muscular atrophyErleadaProstate cancerTrodelvyBreast cancerImdelltraSmall cell lung cancer of $9.2 billion. SpinrazaIn January 2026, Biogen announced that the European Commission granted marketing authorization for a high dose regimen of Spinraza for spinal muscular atrophy.pelabresibIn January 2026, Novartis announced plans to submit a European Union regulatory filing for pelabresib in 2026, and that it would begin a new Phase 3 study in 2026 in the United States, Canada and Japan.obexelimabIn January 2026, Zenas BioPharma (Zenas) announced positive results from the Phase 3 INDIGO trial of obexelimab in Immunoglobulin G4-related disease (lgG4-RD), which met the primary endpoint demonstrating a clinically meaningful and highly statistically significant reduction in risk of lgG4-RD flare. Zenas anticipates submitting a Biologics License Application (BLA) in Q2 2026 and a Marketing Authorization Application to the EMA in the second half of 2026. In October 2025, Zenas announced positive results from the Phase 2 trial of obexelimab in relapsing multiple sclerosis, which demonstrated a highly statistically significant 95% relative reduction in new gadolinium (Gd)-enhancing T1 lesions over week 8 and week 12 compared with placebo. Zenas anticipates reporting 24-week data in the first quarter of 2026.Myqorzo (aficamten)In December 2025, Cytokinetics announced the FDA approval of Myqorzo for the treatment of adults with symptomatic obstructive hypertrophic cardiomyopathy.TEV-'749In December 2025, Teva Pharmaceuticals submitted a New Drug Application to the FDA for olanzapine LAI for the treatment of schizophrenia in adults. deucrictibantIn December 2025, Pharvaris announced positive topline data from the RAPIDe-3 pivotal Phase 3 study, which met its primary endpoint and all secondary efficacy endpoints with statistical significance. The data will serve as the basis for marketing authorization applications expected to be filed in first half of 2026.CobenfyIn December 2025, Bristol Myers Squibb announced that it will enroll additional patients in the Phase 3 ADEPT-2 study of Cobenfy in psychosis associated with Alzheimer’s disease. Following consultation with the FDA and a review by the independent Data Monitoring Committee, the study will continue as planned with results expected by the end of 2026.ImdelltraIn November 2025, Amgen announced that the FDA granted full approval to Imdelltra for the treatment of adult patients with extensive stage small cell lung cancer (ES-SCLC) with disease progression on or after platinum-based chemotherapy, converting Imdelltra’s prior accelerated approval into a full approval.TysabriIn November 2025, Sandoz announced the U.S. launch of Tyruko, the first and only FDA-approved biosimilar to Biogen’s Tysabri.TrodelvyIn November 2025, Gilead announced the Phase 3 ASCENT-07 study investigating Trodelvy as a first-line (1L) treatment for HR+/HER2-negative metastatic breast cancer patients did not meet the primary endpoint of progression-free survival. Overall survival is a key secondary endpoint and was not mature at the time of the primary analysis.In October 2025, Gilead announced that based on the positive Phase 3 updates from ASCENT-03 and ASCENT-04, it has submitted two supplemental BLAs for Trodelvy in 1L metastatic triple-negative breast cancer and expects regulatory decisions in 2026. daraxonrasibIn October 2025, Revolution Medicines announced that the FDA granted a non-transferrable voucher for daraxonrasib under the Commissioner’s National Priority Voucher pilot program, which accelerates target review times to 1-2 months versus 6+ months.litifilimabIn October 2025, Biogen announced that both litifilimab Phase 3 studies for systemic lupus erythematosus are fully enrolled with expected data readout for both studies accelerated to the second half of 2026. the conference call and webcast will be archived on the company’s website for at least 30 days. variable payments based on sales of products, net of contractual payments to the legacy non-controlling interests, that are GAAP reconciliation in Table 4. •Net cash provided by operating activities of $827 million in Q4 2025 and $2,490 million for FY 2025 attributed to Royalty Pharma. •Full year 2026 guidance: Portfolio Receipts expected to be $3,275 million to $3,425 million In 2025, Royalty Pharma paid a quarterly dividend of $0.22 per share, equating to $512 million in dividends and (3)Portfolio Cash Flow is defined under the credit agreement as Adjusted EBITDA minus interest paid or received, net. See GAAP to Non-GAAP About Royalty Pharma plc distributions. In the first quarter of 2026, Royalty Pharma increased its quarterly dividend by 7% to $0.235 per share. reconciliation in Table 4. Portfolio Cash Flow reflects the cash generated by Royalty Pharma’s business that can be redeployed into value-enhancing Milestones and other contractual receipts include sales-based or regulatory milestone payments and other fixed NEW YORK, NY, February 11, 2026 - Royalty Pharma plc (Nasdaq: RPRX) today reported financial results for the fourth royalty acquisitions, used to repay debt, returned to shareholders through dividends or share purchases or utilized for other discretionary contractual receipts, net of contractual payments to legacy non-controlling interests, that are attributed to Royalty Pharma. Founded in 1996, Royalty Pharma is the largest buyer of biopharmaceutical royalties and a leading funder of innovation investments. In January 2025, Royalty Pharma announced a new share repurchase program under which it may repurchase up to $3.0 quarter and full year 2025 and introduced full year 2026 guidance for Portfolio Receipts. Portfolio Receipts is defined as the sum of Royalty Receipts and Milestones and other contractual receipts. The above Portfolio Receipts does not include royalty receipts and milestones and other contractual receipts that were received on an across the biopharmaceutical industry, collaborating with innovators from academic institutions, research hospitals and billion of its Class A ordinary shares. Royalty Pharma repurchased approximately two million Class A ordinary shares for (4)Capital Deployment is calculated as the summation of the following line items from Royalty Pharma’s GAAP consolidated statements of cash flows: Portfolio Receipts guidance includes expected Royalty Receipts growth of 3% to 8% in 2026. accelerated basis under the terms of the agreement governing the receipt or payment. Portfolio Receipts also does not non-profits through small and mid-cap biotechnology companies to leading global pharmaceutical companies. Royalty “We had one of the most remarkable years in Royalty Pharma’s history in 2025,” said Pablo Legorreta, Royalty Pharma’s $75 million in the fourth quarter and 37 million shares for $1.2 billion for the full year of 2025. The weighted-average Investments in equity method investees, Purchases of available for sale debt securities, Acquisitions of financial royalty assets, Acquisitions of other include proceeds from equity securities or proceeds from purchases and sales of marketable securities, both of which are Pharma has assembled a portfolio of royalties which entitles it to payments based directly on the top-line sales of many of Chief Executive Officer and Chairman of the Board. “We grew Portfolio Receipts by 16%, driven by the strength of our number of diluted Class A ordinary shares outstanding for the fourth quarter of 2025 was 556 million, a decline of 6% as financial assets, Milestone payments, Development-stage funding payments less Contributions from legacy non-controlling interests - R&D. Royalty Pharma’s full year 2026 guidance reflects an estimated foreign exchange impact of approximately +1% to Portfolio not central to Royalty Pharma’s fundamental business strategy, and excludes the $511 million in 2025 proceeds from the the industry’s leading therapies. Royalty Pharma’s current portfolio includes royalties on more than 35 commercial diversified portfolio, we returned a record amount of capital to shareholders and we deployed $2.6 billion on royalty compared to 589 million for the fourth quarter of 2024. The weighted-average number of diluted Class A ordinary shares Receipts, assuming current foreign exchange rates prevail for the rest of 2026. (5)The term loan that Royalty Pharma assumed as part of the Internalization has a Secured Overnight Financing Rate (SOFR) based variable interest sale of the MorphoSys Development Funding Bonds. products, including Vertex’s Trikafta and Alyftrek, GSK’s Trelegy, Biogen’s Tysabri and Spinraza, Roche’s Evrysdi, Astellas transactions, including our highest year ever for announced synthetic royalty transactions. Further, we achieved an outstanding for full year 2025 was 564 million as compared to 594 million for full year 2024. rate. Royalty Pharma estimated the related interest payment for 2026 based on the forward curve as of February 5, 2026. and Pfizer’s Xtandi, Johnson & Johnson’s Tremfya, AbbVie and Johnson & Johnson’s Imbruvica, Servier’s Voranigo, Gilead’s important milestone with the successful internalization of our external manager. Looking ahead, our deal pipeline remains Payments for operating and professional costs in 2026 are expected to decrease as a percentage of Portfolio Receipts, Portfolio Receipts is calculated as the sum of the following line items from Royalty Pharma’s GAAP consolidated statements In January 2025, Royalty Pharma accelerated its return by selling the MorphoSys Development Funding Bonds for $511 (6)Other products primarily include Royalty Receipts on the following products: Crysvita, Emgality, Entyvio, Farxiga/Onglyza, IDHIFA, Nesina, Nurtec Trodelvy, Amgen’s Imdelltra and Alnylam’s Amvuttra, among others, and 20 development-stage product candidates. robust and we anticipate multiple events for our development-stage pipeline in 2026 - including pivotal study results for compared to 8.9% in 2025, primarily due to extinguishment of the management fee following the completion of the of cash flows: Cash collections from financial royalty assets, Cash collections from intangible royalty assets, Other royalty ODT, Orladeyo, Prevymis, Soliqua and distributions from the Legacy SLP Interest, which is presented as Distributions from equity method investees on million. This payment, combined with quarterly repayments received prior to the sale, resulted in total cash proceeds of daraxonrasib, pelacarsen and litifilimab - that could unlock additional value. I am confident 2026 will be another year of internalization transaction on May 16, 2025. the GAAP consolidated statements of cash flows. cash collections, Proceeds from available for sale debt securities and Distributions from equity method investees less Amounts may not add due to rounding. $530 million on the $300 million investment that was made in September 2022. The proceeds provided added flexibility to Forward-Looking Statements exciting progress towards strengthening our leadership position in the rapidly growing royalty market and pursuing our Distributions to legacy non-controlling interests - Portfolio Receipts, which represent contractual distributions of Royalty Total interest paid is based on the semi-annual interest payment schedule of Royalty Pharma’s existing notes and the pursue the company's dynamic capital allocation strategy. goal to be the premier capital allocator in life sciences with consistent, compounding growth.” (7)The table below shows the line item for each adjustment and the direct location for such line item on the GAAP consolidated statements of cash Receipts, milestones and other contractual receipts to the Legacy Investors Partnerships. quarterly interest payment schedule for the term loan assumed as part of the internalization transaction. In 2026, Royalty The information set forth herein does not purport to be complete or to contain all of the information you may desire. flows. Strong double-digit growth in Royalty Receipts and Portfolio Receipts Pharma anticipates interest paid to be approximately $350 million to $360 million(5), with approximately $175 million in Statements contained herein are made as of the date of this document unless stated otherwise, and neither the delivery of Liquidity Summary EPAs: Equity Performance Awards. Amounts may not add due to rounding. Royalty Transactions Reconciling AdjustmentStatements of Cash Flows ClassificationInterest (paid)/received, netOperating activities (Interest paid less Interest received)Distributions from equity method investeesInvesting activitiesProceeds from available for sale debt securitiesInvesting activitiesDistributions to legacy non-controlling interests - Portfolio ReceiptsFinancing activities Use of Non-GAAP Measures each of the first and third quarters of 2026. De minimis amounts are anticipated in the second and fourth quarters of 2026. this document at any time, nor any sale of securities, shall under any circumstances create an implication that the
Royalty Receipts grew 17% to $856 million in the fourth quarter and 13% to $3,127 million in 2025, primarily Three Months Ended December 31,Twelve Months Ended December 31,(unaudited)($ in millions)2025202420252024Portfolio Receipts8747423,2542,801Payments for operating and professional costs(58)(72)(288)(236)Adjusted EBITDA (non-GAAP)8166692,9662,565Interest (paid)/received, net(0)8(242)(113)Portfolio Cash Flow (non-GAAP)8156782,7242,452 These projections assume no additional debt financing in 2026, including no drawdown on the revolving credit facility. In information contained herein is correct as of any time after such date or that information will be updated or revised to During 2025, Royalty Pharma announced new transactions of up to $4.7 billion which reflects the entire amount of driven by Voranigo, Trelegy, Tremfya and the cystic fibrosis franchise. Adjusted EBITDA and Portfolio Cash Flow are non-GAAP liquidity measures that exclude the impact of certain items and 2025, Royalty Pharma collected interest of $34 million on its cash and cash equivalents. reflect information that subsequently becomes available or changes occurring after the date hereof. potential capital committed for new transactions, including potential future milestones. •Portfolio Receipts increased by 18% to $874 million in the fourth quarter and 16% to $3,254 million in 2025. therefore have not been calculated in accordance with GAAP. Management believes that Adjusted EBITDA and Portfolio Cash Flow are important non-GAAP measures used to analyze liquidity because they are key components of certain Royalty Pharma today provides this guidance based on its most up-to-date view of its prospects. This guidance assumes no This document contains statements that constitute “forward-looking statements” as that term is defined in the United Recent transactions include: Balanced capital allocation approach drives value creation material covenants contained within Royalty Pharma’s credit agreement. Royalty Pharma cautions readers that amounts major unforeseen adverse events or changes in foreign exchange rates and excludes the contributions from transactions States Private Securities Litigation Reform Act of 1995, including statements that express the company’s opinions,
Capital Deployment of $2.6 billion; added royalties on nine(8) therapies to portfolio in the year, including a ground-
In January 2026, Royalty Pharma announced a funding agreement with Teva Pharmaceuticals for TEV-’408 for up *Percentage change is not meaningful. presented in accordance with the definitions of Adjusted EBITDA and Portfolio Cash Flow may not be the same as similar announced subsequent to the date of this press release. expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results, in contrast (8)Includes royalty interest on Denali’s tividenofusp alfa which is contingent on its FDA accelerated approval. breaking partnership with Revolution Medicines for Phase 3 therapy daraxonrasib for pancreatic cancer. Amounts shown in the table may not add due to rounding. Results for full year 2025 and 2024 are shown in Table 5. to $500 million. The agreement includes $75 million to co-fund a Phase 2b study for vitiligo targeted for 2026. measures used by other companies or analysts. These non-GAAP liquidity measures have limitations as analytical tools, and with statements that reflect historical facts. Examples include discussion of Royalty Pharma’s strategies, financing plans,
Repurchased 37 million Class A ordinary shares for $1.2 billion in 2025, including $75 million in the fourth quarter. *Percentage change is not meaningful. Based on the future results from the Phase 2b study in vitiligo, Royalty Pharma will have an option to provide an you should not consider them in isolation or as a substitute for the analysis of Royalty Pharma’s results as reported under growth opportunities, market growth and plans for capital deployment, plus the benefits of the internalization transaction, Royalty Receipts was $856 million in the fourth quarter of 2025, an increase of 17% compared to $729 million in the fourth •Increased quarterly dividend by 7% in the first quarter of 2026. Amounts may not add due to rounding. additional $425 million to co-fund the Phase 3 development program. GAAP. including expected accretion, enhanced alignment with shareholders, increased investment returns, expectations regarding quarter of 2024. The increase was primarily driven by Voranigo, Trelegy, Tremfya and the cystic fibrosis franchise, which management continuity, transparency and governance, and the benefits of simplification to its structure. In some cases, Positive clinical and regulatory updates across royalty portfolio in 2025 was partially offset by a decline from Promacta due to U.S. generic competition which launched in May 2025. •In December 2025, Royalty Pharma acquired the remaining royalties on Roche's Evrysdi for the treatment of spinal The definitions of Adjusted EBITDA and Portfolio Cash Flow used by Royalty Pharma are the same as the definitions in the you can identify such forward-looking statements by terminology such as “anticipate,” “intend,” “believe,” “estimate,” Amounts may not add due to rounding.
FDA approvals of Cytokinetics' Myqorzo (formerly aficamten) in obstructive hypertrophic cardiomyopathy and muscular atrophy from PTC Therapeutics for an upfront payment of $240 million and up to $60 million in sales- credit agreement. Noncompliance with the interest coverage ratio, leverage ratio and Portfolio Cash Flow ratio covenants “plan,” “seek,” “project,” “expect,” “may,” “will,” “would,” “could” or “should,” the negative of these terms or similar Portfolio Receipts was $874 million in the fourth quarter of 2025, an increase of 18% compared to $742 million in the Johnson & Johnson's Tremfya in Crohn's disease and ulcerative colitis. based milestones. under the credit agreement could result in lenders requiring the company to immediately repay all amounts borrowed. If Amounts may not add due to rounding.
Adjusted EBITDA (non-GAAP) was $816 million in the fourth quarter of 2025. Adjusted EBITDA is calculated as expressions. Forward-looking statements are based on management’s current beliefs and assumptions and on information fourth quarter of 2024, primarily driven by the same Royalty Receipts increases noted above.
Positive Phase 3 results for Teva's TEV-'749 in schizophrenia, Gilead's Trodelvy in 1L metastatic triple negative Royalty Pharma cannot satisfy these covenants, it would be prohibited under the credit agreement from engaging in Portfolio Receipts minus payments for operating and professional costs. currently available to the company. However, these forward-looking statements are not a guarantee of Royalty Pharma’s •In December 2025, Royalty Pharma acquired a pre-existing royalty interest in Nuvalent's neladalkib and breast cancer, Emalex's ecopipam in Tourette's syndrome and Pharvaris' deucrictibant in hereditary angioedema. certain activities, such as incurring additional indebtedness, paying dividends, making certain payments, and acquiring and performance, and you should not place undue reliance on such statements. Forward-looking statements are subject to zidesamtinib from an undisclosed party for up to $315 million, including an upfront payment of $155 million. disposing of assets. Consequently, Adjusted EBITDA and Portfolio Cash Flow are critical to the assessment of Royalty •Portfolio Cash Flow (non-GAAP) was $815 million in the fourth quarter of 2025. Portfolio Cash Flow is calculated many risks, uncertainties and other variable circumstances, and other factors. Such risks and uncertainties may cause the Financial guidance for full year 2026 (excludes contribution from future transactions) Neladalkib and zidesamtinib are next-generation tyrosine kinase inhibitors (TKIs). Neladalkib is in development for Pharma’s liquidity. as Adjusted EBITDA minus interest paid or received, net. This measure reflects the cash generated by Royalty statements to be inaccurate and readers are cautioned not to place undue reliance on such statements. Many of these patients with anaplastic lymphoma kinase (ALK) mutation-positive non-small cell lung cancer (NSCLC) and •Royalty Pharma expects 2026 Portfolio Receipts to be between $3,275 million and $3,425 million. Pharma’s business that can be redeployed into value-enhancing royalty acquisitions, used to repay debt, returned risks are outside of the company’s control and could cause its actual results to differ materially from those it thought would zidesamtinib is in development for ROS proto-oncogene 1 (ROS1) mutation-positive NSCLC. Adjusted EBITDA and Portfolio Cash Flow are used by management as key liquidity measures in the evaluation of the •2026 Portfolio Receipts guidance includes expected growth in Royalty Receipts of 3% to 8%. to shareholders through dividends or share purchases, or utilized for other discretionary investments. occur. The forward-looking statements included in this document are made only as of the date hereof. The company does company’s ability to generate cash from operations. Management uses Adjusted EBITDA and Portfolio Cash Flow when
In December 2025, Royalty Pharma announced a transaction to acquire a royalty interest in Denali Therapeutics’ not undertake, and specifically declines, any obligation to update any such statements or to publicly announce the results considering available cash, including for decision-making purposes related to funding of acquisitions, debt repayments, Refer to Table 4 for Royalty Pharma’s reconciliation of each non-GAAP measure to the most directly comparable GAAP Financial & Liquidity Summary tividenofusp alfa for up to $275 million. Tividenofusp alfa is Denali’s lead investigational TransportVehicle-enabled of any revisions to any such statements to reflect future events or developments, except as required by law. dividends and other discretionary investments. Further, these non-GAAP liquidity measures help management, the audit financial measure, net cash provided by operating activities. enzyme replacement therapy for the treatment of mucopolysaccharidosis type II (MPS II, or Hunter syndrome). Three Months Ended December 31,Twelve Months Ended December 31,(unaudited)($ and shares in millions)20252024Change20252024ChangePortfolio Receipts87474218%3,2542,80116%Net cash provided by operating activities82774311%2,4902,769(10)%Adjusted EBITDA (non-GAAP)*81666922%2,9662,56516%Portfolio Cash Flow (non-GAAP)*81567820%2,7242,45211%Weighted average Class A ordinary shares outstanding - diluted556589(6)%564594(5)% committee and investors evaluate the company’s ability to generate liquidity from operating activities. Certain information contained in this document relates to or is based on studies, publications, surveys and other data Royalty Pharma will make a $200 million payment contingent on U.S. Food and Drug Administration (FDA) Capital Deployment reflects cash payments during the period for new and previously announced transactions. Capital obtained from third-party sources and the company’s own internal estimates and research. While the company believes accelerated approval and a $75 million payment on European Medicines Agency (EMA) approval if achieved by The company has provided reconciliations of these non-GAAP liquidity measures to the most directly comparable GAAP Deployment was $887 million in the fourth quarter of 2025, consisting primarily of upfront payments for the Amvuttra, these third-party sources to be reliable as of the date of this document, it has not independently verified, and makes no December 31, 2029. financial measure, being net cash provided by operating activities in Table 4. zidesamtinib and neladalkib royalty transactions and remaining royalties on Evrysdi (see 'Royalty Transactions'), as well as representation as to the adequacy, fairness, accuracy or completeness of, any information obtained from third-party the Cytokinetics Commercial Launch Funding and research and development funding for litifilimab. Capital Deployment for The information in this section should be read together with Royalty Pharma’s reports and documents filed with the SEC at sources. In addition, all of the market data included in this document involves a number of assumptions and limitations, Royalty Pharma Investor Relations and Communications the full year 2025 amounted to $2.6 billion. www.sec.gov and the reader is also encouraged to review all other press releases and information available in the Investors and there can be no guarantee as to the accuracy or reliability of such assumptions. Finally, while the company believes its section of Royalty Pharma’s website at www.royaltypharma.com. +1 (212) 883-6772 own internal research is reliable, such research has not been verified by any independent source. ir@royaltypharma.com For further information, please reference Royalty Pharma’s reports and documents filed with the U.S. Securities and Exchange Commission ("SEC") by visiting EDGAR on the SEC's website at www.sec.gov. *See “Liquidity and Capital Resources” section. Adjusted EBITDA and Portfolio Cash Flow are non-GAAP liquidity measures calculated in accordance with the credit agreement. EPAs: Equity Performance Awards. Amounts may not add due to rounding. 1 2 3 4 5 6 7 8 9 10 12 13 14 15 11