Core Insights - Royalty Pharma is hosting an Investor Day to discuss its strategies for shareholder value creation through its unique business model in the biopharma royalty market [1][2] - The company anticipates continued strong growth in the biopharma royalty market, targeting a mid-teens average annual total shareholder return through 2030 [2][12] Financial Performance and Projections - Royalty Pharma expects a compound annual growth rate of approximately 12% in Portfolio Receipts from 2020 to 2025, aiming for at least $4.7 billion in Portfolio Receipts by 2030 [3][4] - The company has achieved a Return on Invested Capital (ROIC) of approximately 15% and a Return on Invested Equity (ROIE) of approximately 21% since 2019 [6][7] - The biopharma royalty market has seen significant growth, averaging $6.2 billion in announced transaction value per year from 2020 to 2024, more than double the previous five-year average [7][9] Capital Deployment and Investment Strategy - Royalty Pharma is on track to exceed its five-year capital deployment target of $10 billion to $12 billion, with $14 billion in announced transactions and $9 billion deployed to date [4][5] - The company expects to achieve an unlevered internal rate of return (IRR) in the mid-teens on its post-IPO investments, with strong returns on both approved and development-stage products [5][6] Market Trends and Industry Position - A Deloitte market study indicates growing interest in royalty funding among biopharma executives, with 54% reporting increased interest and 87% considering royalties for capital needs [9][10] - Royalty Pharma has expanded its workforce approximately three-fold since its IPO, enhancing its capabilities in data and analytics to support its growth strategy [10][11] Shareholder Value Creation - The company aims to be a premier capital allocator in life sciences, with plans for share buybacks and a commitment to grow dividends by a mid-single digit percentage annually [11][12] - Royalty Pharma's investment platform is expected to gain recognition, potentially leading to significant upside beyond the targeted mid-teens total shareholder return [12]

Core Insights - The report by Royalty Pharma and Deloitte highlights the increasing importance of royalties in funding biopharma innovation, marking a shift towards a diversified funding model in the industry [1][2][6] - Royalties are recognized as a vital component of capital structure, providing flexible, non-dilutive capital to support significant capital requirements in biopharma [2][3][6] Industry Dynamics - The study involved over 110 biopharma leaders, primarily CEOs and CFOs, to gather insights on royalty funding, revealing that royalties play a crucial role in supporting life sciences innovation and commercial success [3][6] - The report indicates a growing acceptance of royalties as part of a diversified funding strategy, driven by their non-dilutive nature, absence of covenants, and retention of operational control [7] Market Outlook - 87% of surveyed biopharma executives expressed willingness to consider royalties in their capital raising plans over the next three years, indicating a positive outlook for royalty funding in the industry [7] - The strategic benefits of royalties, including attractive cost of capital and positive investor perception, are contributing to their increasing adoption in the biopharma sector [6][7] Company Overview - Royalty Pharma, founded in 1996, is the largest buyer of biopharmaceutical royalties and a key funder of innovation, collaborating with various entities from academic institutions to leading global pharmaceutical companies [4] - The company has a diverse portfolio of royalties, entitling it to payments based on the sales of over 35 commercial products, including notable therapies from Vertex, GSK, Roche, and others [4]