Royalty Pharma plc: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 6 May 2026: press release. Guidance figures: 1 raised, 1 narrowed, 4 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Portfolio Receipts up 10%: Portfolio Receipts were $925 million, up from $839 million. Milestones and other contractual receipts fell 25% to $38 million, partly offsetting the Royalty Receipts gain of 13%. Source
• Tremfya, Voranigo and Evrysdi drove growth: Tremfya receipts rose 79% to $64 million, Voranigo 140% to $47 million and Evrysdi 51% to $80 million, according to the product table. Source
• Capital Deployment of $528 million: Capital Deployment was $528 million: $452 million for acquisitions of royalty assets, $50 million of milestone payments and $26 million of development-stage funding. Source
• Three royalties acquired for $1.25 billion: Three royalties were acquired for $1.25 billion in announced value. The company said this figure reflects the entire amount of potential capital committed for new transactions. Source
• Myqorzo met dual primary endpoints: Cytokinetics reported that the ACACIA-HCM Phase 3 trial of Myqorzo in non-obstructive hypertrophic cardiomyopathy met both primary endpoints versus placebo at week 36. Source
• R&D co-funding as funding modality: Management described R&D co-funding with biopharma companies as a growing funding modality, citing the Johnson & Johnson and Teva agreements this year. Source

“We grew Royalty Receipts by 13% and announced up to $1.25 billion of royalty transactions in the first quarter.”

Pablo Legorreta, Royalty Pharma’s Chief Executive Officer and Chairman of the Board

Guidance

What changed from last quarter

• Guidance raised: Portfolio Receipts guidance was raised from $3,275 million to $3,425 million to $3,325 million to $3,450 million. Royalty Receipts growth guidance moved from 3% to 8% to 4% to 8%. Source
• Guidance kept: Operating cost and interest paid guidance were kept at the prior levels. Source
• New: Johnson & Johnson R&D co-funding agreement for JNJ-4804, providing $500 million over two years, was entered in March 2026. Source
• New: Royalty interest in Ziihera acquired from Zymeworks Inc. for $250 million in March 2026. Source
• New: Key leaders were added to strengthen capabilities in the Asia-Pacific region, partnering and AI. Source
• Ended: Ipsen is withdrawing Tazverik from all Ipsen markets, and Eisai plans to discontinue Tazverik sales in Japan. Source

Results and growth drivers

• Portfolio Receipts up 10%: Portfolio Receipts were $925 million, up from $839 million. Milestones and other contractual receipts fell 25% to $38 million, partly offsetting the Royalty Receipts gain of 13%. Source
• Adjusted EBITDA and cash flow higher: Adjusted EBITDA rose 21% to $889 million and Portfolio Cash Flow rose 18% to $722 million. Net cash provided by operating activities was $718 million, up 20%. Source
• Net income to shareholders higher: Net income attributable to Royalty Pharma plc was $295 million, against $239 million. Consolidated net income was $468 million, against $434 million. Source

Products and marketers

• Tremfya, Voranigo and Evrysdi drove growth: Tremfya receipts rose 79% to $64 million, Voranigo 140% to $47 million and Evrysdi 51% to $80 million, according to the product table. Source
• Promacta fell on generic competition: Promacta receipts fell 61% to $17 million. The company attributed the decline to U.S. generic competition. Source
• Evrysdi included acquired royalties: Evrysdi receipts included the benefit of royalties acquired in December 2025. Imdelltra ($17 million) and Amvuttra ($8 million) show no prior-year receipts in the table. Source
• Cystic fibrosis flat, some products lower: Cystic fibrosis franchise receipts were $253 million, up 1%. Trelegy rose 15% to $98 million, while Tysabri fell 3% and Imbruvica fell 17%. Source

“Our transactions this year included two such agreements - with Johnson & Johnson and Teva - underscoring the growing demand for this novel funding modality.”

Pablo Legorreta, Royalty Pharma’s Chief Executive Officer and Chairman of the Board

Operating costs and interest

• Operating cost payments fell: Payments for operating and professional costs were $36 million, against $102 million a year earlier. The company expects these costs to fall as a share of Portfolio Receipts in 2026, from 8.9% in 2025. Source
• Share-based compensation lifts G&A: General and administrative expenses were $159 million, including $122 million of share-based compensation, against $1 million a year earlier. Source
• Interest costs higher: Interest expense was $94 million, against $65 million. Interest paid was $174 million in the cash flow statement, against $139 million. Source

Capital deployment and transactions

• Capital Deployment of $528 million: Capital Deployment was $528 million: $452 million for acquisitions of royalty assets, $50 million of milestone payments and $26 million of development-stage funding. Source
• Three royalties acquired for $1.25 billion: Three royalties were acquired for $1.25 billion in announced value. The company said this figure reflects the entire amount of potential capital committed for new transactions. Source
• Teva vitiligo co-funding agreement: The Teva TEV-’408 funding agreement is up to $500 million. It includes $75 million for a Phase 2b vitiligo study and an option to provide up to $425 million more for Phase 3. Source

“As a result, we are incredibly well positioned as a premier capital allocator in life sciences to deliver consistent, compounding growth.”

Pablo Legorreta, Royalty Pharma’s Chief Executive Officer and Chairman of the Board

Cash, debt and shareholder returns

• Cash and debt at quarter-end: Cash and cash equivalents were $586 million, against $619 million at December 31, 2025. Total debt principal was $9.2 billion. Source
• Quarterly dividend paid: The quarterly dividend was $0.235 per share, totalling $136 million in dividends and distributions for the quarter. Source
• Buyback and lower share count: About 1.1 million Class A shares were repurchased for $50 million under the $3.0 billion program. Weighted diluted shares fell 4% to 557 million. Source

Pipeline and portfolio events

• Myqorzo met dual primary endpoints: Cytokinetics reported that the ACACIA-HCM Phase 3 trial of Myqorzo in non-obstructive hypertrophic cardiomyopathy met both primary endpoints versus placebo at week 36. Source
• Daraxonrasib Phase 3 results positive: Revolution Medicines reported positive Phase 3 results in previously treated metastatic pancreatic cancer and intends to file a future NDA. Source
• Neladalkib filed with FDA: Nuvalent submitted a New Drug Application to the FDA for neladalkib in ALK-positive non-small cell lung cancer. Source
• Tazverik impairment recorded: Royalty Pharma recorded $69 million of non-cash impairment charges on Tazverik royalties in the quarter. Source
• Ampreloxetine trial did not meet endpoint: Theravance's CYPRESS Phase 3 study of ampreloxetine did not meet its primary endpoint, and Theravance will wind down the program. Source

Guidance assumptions and exclusions

• Guidance excludes new transactions: Guidance excludes transactions and borrowings announced after May 6, 2026, and assumes no major unforeseen adverse events. Source
• No new debt assumed for 2026: Interest projections assume no additional debt financing in 2026, including no drawdown on the revolving credit facility. Source
• Foreign exchange adds about 1%: The full-year guidance includes an estimated foreign exchange impact of about +1% on Portfolio Receipts, assuming current rates hold for the rest of 2026. Source

Strategy and capital allocation

• R&D co-funding as funding modality: Management described R&D co-funding with biopharma companies as a growing funding modality, citing the Johnson & Johnson and Teva agreements this year. Source
• Asia-Pacific, partnering and AI hires: Key leaders were added to strengthen capabilities in the Asia-Pacific region, partnering and AI, according to the CEO. Source
• Positioned as premier capital allocator: Management described the company as positioned to be a premier capital allocator in life sciences, aiming for consistent, compounding growth. Source

Coming up, as management said on 6 May 2026

• Ziihera FDA action date: The FDA set an August 25, 2026 target action date for the Ziihera supplemental application for first-line gastroesophageal adenocarcinoma, under Priority Review. Source
• Teva vitiligo Phase 2b study: A Phase 2b vitiligo co-funding study is targeted for 2026. Its results will determine whether the Phase 3 option is exercised. Source
• Daraxonrasib regulatory submission planned: Revolution Medicines intends to submit the Phase 3 data to global regulators, including the FDA, as part of a future NDA. Source
• Zenas filings planned for 2026: Zenas expects to submit a Biologics License Application for obexelimab in Q2 2026 and a Marketing Authorization Application to the European Medicines Agency in the second half of 2026. Source
• Pelabresib filings and new study: Novartis plans a European Union regulatory filing for pelabresib in 2026 and a new Phase 3 study in the United States, China and Japan. Source

Figures management reported

Risks management discussed

• Financial: A breach of interest coverage, leverage or Portfolio Cash Flow covenants could let lenders require immediate repayment of borrowings. Source
• Financial: The term loan assumed in the internalization carries a SOFR-based variable rate, so interest paid can change with rates. Source
• External: Guidance assumes no major unforeseen adverse events and no change in foreign exchange rates, and excludes later transactions. Source
• Regulatory: Ipsen withdrew Tazverik from its markets on emerging data from an ongoing trial, which ended royalty-bearing sales of that product. Source
• Operational: The ampreloxetine Phase 3 study did not meet its primary endpoint, and the program is being wound down. Source

Earlier plans management reported on

• Not stated: The prior release expected pivotal results for daraxonrasib, pelacarsen and litifilimab during 2026. The current release reports positive Phase 3 results for daraxonrasib.
• Not stated: The February guidance was later raised to $3,325 million to $3,450 million. The release does not state whether the prior range was met.

Other quarters

• Q3 FY2026 earnings call
• Q2 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 results

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.