Royalty Pharma (RPRX) Bank of America 2025 Healthcare Conference summary

Key business developments

• Internalization transaction approved by 99.9% of shareholders, marking a significant milestone.

• Strong Q1 performance with 17% top-line growth and 12% growth in royalty receipts.

• $725 million in share buybacks executed in Q1, with a balanced approach to capital allocation between buybacks and new royalty deals.

• Upgraded by Moody's to Baa2, reflecting a strong balance sheet and leverage capacity.

• Well-capitalized with over $1 billion in cash and leverage targeted at 3–4x EBITDA.

Market environment and strategy

• Flexible approach to deal-making, adapting to uncertainty in tariffs, drug pricing, and regulatory changes.

• Minimal exposure to tariffs due to royalty structure; focus remains on sales from manufacturer to third party.

• Preference for investments with clear regulatory paths and strong clinical data.

• Royalty market is expanding, with increasing opportunities and a growing role in biopharma funding.

• Capital availability cycles in biotech have not significantly impacted deal flow or strategy.

Portfolio and investment highlights

• Open, flexible approach to new investments, focusing on high-impact medicines across therapeutic areas.

• Recent deal in an underserved market with over 100,000 patients and no new drug approvals in 10 years.

• Speed and preparedness in deal execution enhanced by team expansion and pre-emptive research.

• Largest royalty asset, Trikafta, continues to perform strongly; gradual launch of Alyftuca being monitored.

• Confident in legal position regarding royalty rates for deuterated Ivacaftor.