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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)


☒			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, ~~2024~~2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to __________

Commission file number 001-39329

Royalty Pharma plc

(Exact name of registrant as specified in its charter)


England and Wales									98-1535773
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

110 East 59th Street
New York, New York 10022

(Address of principal executive offices and Zip Code)

(212) 883-0200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A ordinary shares, par value $0.0001	RPRX	The Nasdaq Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting ordinary shares held by non-affiliates of the registrant as of June 30, ~~2024~~2025, the last business day of the registrant’s most recently completed second fiscal quarter, was approximately $1316.17 billion based upon the closing price reported for such date on the Nasdaq Stock Market LLC. This determination of affiliate status is not necessarily a conclusive determination for any other purposes.

As of February 76, ~~2025~~2026, Royalty Pharma plc had ~~433~~428,~~324~~418,~~905~~612 Class A ordinary shares outstanding and ~~143~~148,~~128~~438,~~262~~141 Class B ordinary shares outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive proxy statement for the ~~2025~~2026 Annual General Meeting of Shareholders, or Proxy Statement, are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. Such Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the registrant’s fiscal year ended December 31, ~~2024~~2025. Except with respect to information specifically incorporated by reference in this Annual Report on Form 10-K, the Proxy Statement shall not be deemed to be filed as part hereof.

ROYALTY PHARMA PLC

PART I
Item 1.	Business	1
Item 1A.	Risk Factors	1514
Item 1B.	Unresolved Staff Comments	4542
Item 1C.	Cybersecurity	4542
Item 2.	Properties	4643
Item 3.	Legal Proceedings	4643
Item 4.	Mine Safety Disclosures	4743
PART II
Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	4743
Item 6.	[Reserved]	4945
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4945
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	7571
Item 8.	Financial Statements and Supplementary Data	7773
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosures	~~113~~117
Item 9A.	Controls and Procedures	~~113~~117
Item 9B.	Other Information	~~113~~118
Item 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections	~~113~~118
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	~~114~~119
Item 11.	Executive Compensation	~~114~~119
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	~~114~~119
Item 13.	Certain Relationships and Related Transactions, and Director Independence	~~114~~119
Item 14.	Principal Accountant Fees and Services	~~114~~119
PART IV
Item 15.	Exhibits and Financial Statement Schedules	~~115~~120
Item 16.	Form 10-K Summary	~~117~~122
	Signatures	~~117~~122

Special Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K contains statements reflecting our views about our future performance that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “target,” “forecast,” “guidance,” “goal,” “predicts,” “project,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about us, our current and prospective assets, our industry, our beliefs and our assumptions. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. You should evaluate all forward-looking statements made in this Annual Report on Form 10-K in the context of the numerous risks outlined in Part I under Item 1A. under “Risk Factors” in this Annual Report on Form 10-K.

These risks and uncertainties include factors related to, among other topics:

•sales risks of biopharmaceutical products on which we receive royalties;

•the ability of RP Management, LLC (the “Manager”) to locate suitable assets for us to acquire;

•uncertainties related to the acquisition of interests in development-stage biopharmaceutical product candidates and our strategy to add development-stage product candidates to our product portfolio;

•the assumptions underlying our business model;

•our ability to successfully execute our royalty acquisition strategy;

•our ~~ability~~use toof leverage ~~our competitive strengths~~;

•~~actual~~our ~~and~~ability ~~potential~~to ~~conflicts~~leverage ofour ~~interest~~competitive ~~with~~strengths and to realize the ~~Manager~~benefits ~~and~~of ~~its~~our ~~affiliates~~2025 internalization of our manager;

•~~the~~our ability ~~of the Manager or its affiliates~~ to attract and retain highly talented professionals;

•the potential internalization of the Manager;

•the effect of changes to tax legislation and our tax position; and

•the risks, uncertainties and other factors we identify elsewhere in this Annual Report on Form 10-K and in our other filings with the U.S. Securities and Exchange Commission (“SEC”).

Although we believe the expectations reflected in the forward-looking statements are reasonable, any of those expectations could prove to be inaccurate, and as a result, the forward-looking statements based on those expectations also could be inaccurate. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Annual Report on Form 10-K should not be regarded as a representation by us that our plans and business objectives will be achieved. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. We are under no duty to update any of these forward-looking statements after the date of this Annual Report on Form 10-K to conform our prior statements to actual results or revised expectations.

PART I

Item 1. BUSINESS

Overview

We are the largest buyer of biopharmaceutical royalties and a leading funder of innovation across the biopharmaceutical industry. Since our founding in 1996, we have been pioneers in the royalty market, collaborating with innovators from academic institutions, research hospitals and not-for-profits through small and mid-cap biotechnology companies to leading global pharmaceutical companies. We have assembled a portfolio of royalties which entitles us to payments based directly on the top-line sales of many of the industry’s leading therapies, which includes royalties on more than 35 commercial products, including Vertex’s Trikafta and Alyftrek, GSK’s Trelegy, Biogen’s Tysabri and Spinraza, Roche’s Evrysdi, ~~Johnson~~Astellas &and ~~Johnson~~Pfizer’s ~~Tremfya~~Xtandi, ~~Biogen~~Johnson & Johnson’s ~~Tysabri and Spinraza~~Tremfya, AbbVie and Johnson & Johnson’s Imbruvica, ~~Astellas and Pfizer~~Servier’s ~~Xtandi~~Voranigo, ~~Novartis~~Gilead’s ~~Promacta~~Trodelvy, ~~Pfizer~~Amgen’s ~~Nurtec~~Imdelltra ~~ODT,~~and ~~Gilead~~Alnylam’s ~~Trodelvy~~Amvuttra, among others, and 1420 development-stage product candidates. We fund innovation in the biopharmaceutical industry both directly and indirectly - directly when we partner with companies to co-fund late-stage clinical trials and new product launches in exchange for future royalties, and indirectly when we acquire existing royalties from the original innovators.

~~Our~~We ~~industry~~strive ~~leading~~to ~~royalty~~be ~~portfolio~~the ~~and~~premier capital~~-efficient~~ ~~business~~allocator ~~model~~in ~~drives~~life ~~our~~sciences with consistent, compounding growth. WeOur ~~have~~highly aselective ~~focused~~investment ~~strategy~~approach offocuses ~~actively~~on identifying and tracking ~~the development and commercialization of~~ important new therapies, which allows us to ~~move~~act ~~quickly~~efficiently ~~to make acquisitions~~ when opportunities arise. ~~With~~Supported aby ~~deep~~an ~~and~~ experienced ~~team of~~ investment ~~professionals~~team, ana ~~exhaustive~~rigorous due diligence process and a focus on high-quality therapies ~~that~~addressing ~~address~~ significant unmet patient ~~need~~needs, we ~~sustain~~pursue ~~attractive~~royalty ~~returns~~opportunities ~~above~~that ~~our~~best ~~cost~~meet ~~of capital, which in turn propels~~ our ~~compounding~~investment ~~growth~~criteria.

~~Our~~Over ~~unique~~more ~~business~~than ~~model~~30 ~~enables us to benefit from many of the most attractive characteristics of the biopharmaceutical industry~~years, ~~including~~we ~~long~~have ~~product~~refined ~~life~~our ~~cycles,~~business ~~significant~~model ~~barriers to entry~~ and ~~noncyclical~~investment ~~revenues,~~platform ~~but~~that ~~with~~creates ~~substantially~~strong ~~reduced~~competitive ~~exposure~~advantages. toOur ~~many~~model ~~common~~combines ~~industry~~a ~~challenges~~unique ~~such~~structure, aslong ~~early-stage~~investment ~~development~~time ~~risk~~horizon, ~~therapeutic~~structuring ~~area constraints~~flexibility, ~~high~~scale ~~research~~ and ~~development (“R&D”) costs~~diversification, and ~~high~~singular ~~fixed~~focus ~~manufacturing~~on ~~and marketing costs~~biopharmaceuticals. WeThis ~~have~~is areinforced ~~highly~~by ~~flexible~~our ~~approach~~investment ~~that~~platform isanchored ~~agnostic~~in todeep ~~both~~life ~~therapeutic~~sciences ~~area~~expertise, ~~and~~exceptional ~~treatment modality~~talent, ~~allowing~~extensive ~~us to acquire royalties on the most attractive therapies across the biopharmaceutical~~ industry. ~~Additionally~~relationships, ~~our~~an ~~focus~~industrialized oninvestment ~~acquiring~~process ~~royalties on approved products, often in the early stages of their commercial launches,~~ and onproprietary ~~development-stage product candidates with strong proof of concept~~ data, ~~mitigates development risk~~ and ~~expands~~analytics ~~our opportunity set~~capabilities.

In ~~2024~~2025, we generated $23.83 billion of Portfolio Receipts (as defined below) ~~and~~which ~~announced~~does ~~transactions~~not ~~with~~include athe ~~total~~$511 ~~potential~~million ~~value~~of proceeds from our sale of ~~$2.8~~the ~~billion~~MorphoSys Development Funding Bonds. Portfolio Receipts is a key performance metric that represents our ability to generate cash from our portfolio investments, the primary source of capital that we can deploy to make new portfolio investments. Portfolio Receipts is defined as the sum of Royalty Receipts (as defined below) and milestones and other contractual receipts. Please refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Portfolio Overview” for additional discussion regarding Portfolio Receipts. WeIn 2025, we announced transactions with a total potential value of $4.7 billion and deployed $2.86 billion of cash to acquire royalties, milestones and other contractual receipts (“Capital Deployment”). inCapital ~~2024,~~Deployment ~~which also~~ includes payments made during the year for transactions from prior years. Capital Deployment represents the total annual outflows that will drive future Portfolio Receipts.

~~(1)Royalty~~Amounts ~~receipts~~shown ~~include~~in ~~variable payments based on sales of products, net of contractual payments to~~ the ~~legacy~~table ~~non-controlling~~may ~~interests,~~not ~~that~~add ~~are~~due ~~attributed~~ to ~~Royalty Pharma (“Royalty Receipts”)~~rounding. Milestones and other contractual receipts include sales-based or regulatory milestone payments and other fixed contractual receipts, net of contractual payments to the legacy non-controlling interests, that are attributed to Royalty Pharma.

(1)Royalty receipts include variable payments based on sales of products, net of contractual payments to the legacy non-controlling interests, that are attributed to us (“Royalty Receipts”). Milestones and other contractual receipts include sales-based or regulatory milestone payments and other fixed contractual receipts, net of contractual payments to the legacy non-controlling interests, that are attributed to us.

(2)The 2020 growth rate is calculated on a pro forma basis, which adjusts certain cash flow line items as if our Reorganization Transactions (as described in our final prospectus filed with the SEC on June 17, 2020) and our initial public offering had taken place on January 1, 2019. The most significant difference between the pro forma and reported figures is the non-controlling interest attributable to legacy investors that resulted from the Reorganization Transactions.

Biopharmaceutical Industry and the Role of Royalties

Our business is supported by significant growth and unprecedented innovation within the biopharmaceutical industry. Global prescription pharmaceutical sales are projected to grow from $1.12 trillion in ~~2024~~2025 to $12.70 trillion in ~~2030~~2032, representing a compound annual growth rate of 87% according to EvaluatePharma ~~despite more than $400 billion in cumulative sales being lost to expected patent expiries during the same period~~. This growth is being driven by global secular trends, including population growth, increased life expectancy and growth of the middle classes in emerging markets. In addition, an acceleration of medical research in recent years has led to a better understanding of the molecular origins of disease and identification of potential targets for therapeutic intervention, which has increased R&D investments in new therapies.

The pace of innovation coupled with the proliferation of new biotechnology companies and the increasing cost of drug development has created a significant capital need ~~over~~in recent years that we believe will provide a sustainable tailwind for our business. We estimate that over the next decade academia and other non-profit institutions will spend over $1 trillion in R&D, unprofitable biopharmaceutical companies will spend over $1 trillion in R&D and selling, general and administrative expenses, and profitable biopharmaceutical companies will spend over $2 trillion in R&D.

As a result of the increasing cost and complexity of drug development, the creation of a new drug today typically involves a number of industry participants and can lead to multiple royalties. Academia and other research institutions conduct basic research and license new technologies to industry for further development. Biotechnology companies typically in-license these new technologies, add value through applied research and early-stage clinical development, and then either out-license the resulting product candidates to large biopharmaceutical companies, or commercialize the products themselves. As new drugs are transferred along this value chain, royalties are created as compensation for the licensing or selling institutions.

~~Royalties~~China ~~play~~is aalso ~~fundamental~~emerging ~~and~~as ~~growing~~a ~~role~~strategic inmarket ~~the~~for biopharmaceutical ~~industry.~~companies ~~As a result of the increasing cost~~ and ~~complexity~~there ofhas ~~drug~~been ~~development, the creation of~~ a ~~new~~recent ~~drug~~significant ~~today~~increase ~~typically~~in ~~involves~~licensing adeals ~~number~~between ofChinese ~~industry~~biotechnology ~~participants and can lead to multiple royalties. Academia and other research institutions conduct basic research and license new technologies to industry for further development. Biotechnology~~ companies ~~typically in-license these new technologies, add value through applied research~~ and ~~early-stage~~global ~~clinical~~multinational ~~development, and then either out-license the resulting product candidates to large~~ biopharmaceutical companies~~, or commercialize the products themselves~~. AsThe ~~new~~royalty ~~drugs~~market ~~are~~in ~~transferred~~China ~~along~~represents ~~this~~an ~~value~~important ~~chain,~~long-term ~~royalties~~opportunity ~~are created~~ as ~~compensation for~~ the licensing oractivity ~~selling~~has ~~institutions.~~primarily ~~Biotechnology~~been ~~companies~~focused ~~are also increasingly creating royalties~~ on ~~existing~~therapies ~~products within their portfolios, known as synthetic royalties,~~ in ~~order to provide a source of non~~early-~~dilutive~~stage ~~capital to fund their businesses~~development. Given our leadership position within the biopharmaceutical royalty market, we are able to capitalize on the growing volumes of royalties created as new therapies are developed to address unmet medical needs.

WeBiotechnology ~~estimate~~companies ~~the~~are ~~market~~also ~~for~~increasingly ~~biopharmaceutical~~creating royalties ~~reached~~on ~~$6.2~~existing ~~billion~~therapies inwithin ~~transaction~~their ~~value in 2024. We have executed transactions with an aggregate announced value of $15.5 billion from 2020 through 2024~~portfolios, ~~which~~known ~~represents~~as ansynthetic ~~estimated market share of approximately 51% of all royalty transactions during this period. In comparison~~royalties, wein ~~believe~~order ~~our~~to ~~nearest~~provide ~~competitor~~a ~~has~~source ~~executed $3.9 billion~~ of ~~transactions,~~non-dilutive ~~representing~~capital anto ~~estimated~~fund ~~market~~their ~~share of 13%~~businesses. Given ~~the scale of~~ our ~~business~~leadership ~~relative~~position ~~to our competitors, we have a particularly strong market share of large transactions~~ within the ~~growing~~ biopharmaceutical royalty market~~. Since 2020~~, ~~there~~we ~~have~~are ~~been~~able 16to ~~large~~capitalize ~~royalty~~on ~~transactions~~the ~~each~~growing ~~with~~volumes ~~an aggregate value~~ of ~~$500~~royalties ~~million~~created oras ~~more.~~new Wetherapies ~~have~~are ~~executed 11 of these 16 large transactions, for a total transaction value of approximately $10~~developed.5 ~~billion of cash and an estimated market share of 75% based on the transaction value.~~

Royalties play a fundamental and growing role in the biopharmaceutical industry. They are increasingly being seen as an important part of a biopharmaceutical company’s diversified capital structure and a complement to equity and debt. Royalties offer financial flexibility, no operational restrictions and are non-dilutive to equity holders. Furthermore, royalties can be targeted and tailored to the individual needs of a company. In addition, royalties are emerging as an attractive alternative to a traditional partnership with a larger global biopharmaceutical company, as they allow the biotechnology company to retain operational control of their program, a higher proportion of the economics and reduce administrative complexity.

We estimate the market for biopharmaceutical royalties reached $10.0 billion in transaction value in 2025, which is an approximately 40% increase over the average value of $7.1 billion over the prior five years (2021-2025). The rapid expansion of the royalty market reflects the growing recognition in the life sciences industry of the benefits of royalty funding, and this growth has come in both strong and more restrictive capital market environments.

We have executed transactions with an aggregate announced value of $19.4 billion from 2020 through 2025, which represents an estimated market share of approximately 48% of all royalty transactions during this period. In comparison, we believe our nearest competitor has executed $5.5 billion of transactions over the same period, representing an estimated market share of 14%. Given the scale of our business relative to our competitors, we have a particularly strong market share of large transactions within the growing biopharmaceutical royalty market. Since 2020, there have been 21 large royalty transactions each with an aggregate value of $500 million or more. We have executed 13 of these 21 large transactions, for a total transaction value of approximately $12.7 billion and an estimated market share of 69% based on the transaction value.

Our Business Model

We believe that the following elements of our business and product portfolio provide a unique and compelling proposition to investors seeking exposure to ~~the~~a ~~biopharmaceutical~~premier ~~sector~~capital allocator in life sciences with consistent, compounding growth.

Our business model captures many of the most attractive aspects of the biopharmaceutical industry, but with reduced exposure to many common industry challenges. The biopharmaceutical industry benefits from many attractive characteristics, including long product life cycles, significant barriers to entry and non-cyclical revenues. We have a highly flexible approach that is agnostic to both therapeutic area and treatment modality, allowing us to acquire royalties on the most attractive therapies from across the biopharmaceutical industry. We focus on the acquisition of royalties on approved products or development-stage product candidates that have generated strong proof of concept data, avoiding the risks associated with early-stage R&D. By acquiring royalties, we are able to realize payments based directly on the top-line sales of leading biopharmaceutical therapies, without the costs associated with fixed R&D, manufacturing and commercial infrastructure.

Our unique role in the biopharmaceutical ecosystem positions us to benefit from multiple compounding growth drivers. As a result of our significant scale and highly flexible business model, we believe that we are uniquely positioned to capitalize on multiple compounding growth drivers: an accelerating understanding of the molecular origins of disease, technological innovation leading to the creation of new treatment modalities, an increasing number of biopharmaceutical industry participants with significant capital needs, competitive industry dynamics which reward companies that can rapidly execute broad clinical development programs, increasing U.S Food and Drug Administration (“FDA”) drug approvals, and the potential for multiple royalties to be created from each new drug that reaches the market.

Our portfolio provides direct exposure to a broad array of blockbuster therapies. As of December 31, ~~2024~~2025, our portfolio included royalties on 1516 therapies that each generated end-market sales of more than $1 billion in ~~2024~~2025, including ~~seven~~7 therapies that each generated end-market sales of $3 billion or more. The therapies within our portfolio are marketed by leading global biopharmaceutical companies for whom these products are important sources of revenue. Given the marketers’ significant focus on and investment in these products, they are motivated to invest substantial resources in driving continued sales growth.

Our portfolio is highly diversified across products, therapeutic areas and marketers. As of December 31, ~~2024~~2025, our portfolio consists of royalties on more than 35 marketed biopharmaceutical therapies which address a wide range of therapeutic areas, including rare diseases, neuroscience, ~~cancer~~oncology, hematology, immunology, respiratory and diabetes. In ~~2024~~2025, no individual product accounted for more than 2826% of our Portfolio Receipts. The royalties in our portfolio entitle us to payments based directly on the top-line sales of the associated therapies, rather than the profits of these therapies. As such, the diversification of our cash generation directly reflects the diversification of our royalties, rather than varying levels of product-level profitability, as would typically be expected within a biopharmaceutical company.

The key growth-driving royalties in our portfolio are protected by long patent lives. The estimated weighted average duration of our portfolio is approximately 13 years based on projected cumulative cash royalty receipts. Our largest marketed royalty in ~~2024~~2025 was on Vertex’s cystic fibrosis franchise. Existing patent applications covering Trikafta, the most significant product in that franchise, are expected to provide exclusivity through 2037. Several of our marketed royalties have unlimited durations and could provide cash flows for many years after key patents have expired.

Our simple and efficient operating model generates substantial cash flow ~~for~~to ~~reinvestment~~allocate in ~~new biopharmaceutical royalties. Our capital-efficient operating model requires limited operating expenses and no material capital investment in fixed assets or infrastructure in order to support~~ the ~~ongoing~~best ~~growth~~interest of our ~~business~~shareholders. Our high cash flow conversion provides us with significant capital that we can redeploy ~~for~~dynamically in a disciplined manner to fund new royalty acquisitions and to return to shareholders through dividends or share repurchases. Royalty Pharma employs a dynamic capital allocation framework that is designed to support long-term shareholder value creation. In ~~2024~~2025, we generated Portfolio Receipts of $23.83 billion. We deployed $2.86 billion of cash in ~~2024~~2025 to acquire royalties, milestones and other contractual receipts, paid dividends and distributions of $~~376~~511.59 million and repurchased ~~shares for~~ $~~229~~1.92 ~~million~~billion of shares.

We have a talented, long-tenured team with extensive experience and deep industry relationships. Our team has significant experience identifying, evaluating and acquiring royalties on biopharmaceutical therapies. Together they have been responsible for $2933.29 billion in announced transactions of biopharmaceutical royalties, milestones and other contractual receipts from 2012 through ~~2024~~2025. Our acquisitions have included many of the industry’s leading therapies such as Trikafta, Tremfya, ~~Imbruvica~~Evrysdi, Trelegy and Xtandi. Our long history of collaboration has resulted in deep relationships with a broad range of participants across the biopharmaceutical industry.

Our Strategy

We intend to grow our business by continuing to partner with constituents across the biopharmaceutical value chain to fund innovation. Our growth strategy is tailored to the needs of our partners through a variety of structures:

•Third-party Royalties – Existing royalties on approved or late-stage development therapies ~~with high commercial potential~~. A royalty is the contractual right to a percentage of top-line sales from a licensee’s use of a product, technology or intellectual property. The majority of our current portfolio consists of third-party royalties.

4•Synthetic Royalties – Newly-created royalties on approved or late-stage development therapies with strong proof of concept. A synthetic royalty is the contractual right to a percentage of top-line sales by the developer or marketer of a therapy in exchange for funding.

•~~Synthetic~~Other ~~Royalties~~Funding Modalities – ~~Newly-created~~We ~~royalties~~may onprovide ~~approved~~other orforms ~~late-stage~~of ~~development~~capital ~~therapies~~to ~~with~~our ~~strong~~partners ~~proof~~as ofa ~~concept~~component ~~and~~within ~~high~~a ~~commercial potential. A synthetic~~ royalty istransaction ~~the contractual right~~ to aincrease ~~percentage of top-line sales by~~ the ~~developer~~scale ~~or marketer~~ of aour ~~therapy in exchange for funding~~capital. AThis ~~synthetic royalty~~ may ~~also~~ include ~~contingent~~senior ~~milestone~~unsecured ~~payments.~~debt, Wedirect ~~also~~equity ~~fund~~investments ~~ongoing~~and ~~R&D~~launch ~~for~~and ~~biopharmaceutical~~development ~~companies~~capital (in exchange for ~~future~~fixed ~~royalties~~long-term ~~and milestones if the product or indication we are funding is approved~~payments).

•Launch and Development Capital – Tailored supplemental funding solutions, generally included as a component within a transaction, increase the scale of our capital. Launch and development capital is generally provided in exchange for a long-term stream of fixed payments with a predetermined schedule around the launch of a drug. Launch and development capital may also include a direct investment in the public equity of a company.

•Mergers and Acquisitions (“M&A”) Related – We acquire royalties in connection with M&A transactions, often from the buyers of biopharmaceutical companies when they dispose of the non-strategic assets of the target company following the closing of the acquisition. We also seek to partner with companies to acquire other biopharmaceutical companies that own significant royalties. We may also seek to acquire biopharmaceutical companies that have significant royalties or where we can create royalties in subsequent transactions.

Additionally, we may identify additional opportunities, platforms or technologies that leverage our capabilities.

From 2012 through ~~2024~~2025, we deployed $927.35 billion of cash to acquire royalties, milestones and other contractual receipts. This includes $17.9 billion on approved products and $9.6 billion on development-stage product candidates. As of December 31, ~~2024~~2025, products underlying $6.5 billion of these development-stage acquisitions have already been approved, representing a success rate to date of 7090%, while products underlying $1.0.7 billion were not approved and products underlying $12.84 billion are still in development.

Our investment approach is agnostic to ~~first~~both ~~assess~~therapeutic ~~innovative~~area ~~science in areas of significant unmet medical need~~ and ~~then~~treatment ~~evaluate~~modality, ~~how~~allowing us to acquire royalties on ~~therapies~~the ~~that~~most weattractive ~~believe~~therapies ~~are~~across ~~attractive~~the biopharmaceutical industry. We have a strong base of institutional knowledge of important therapeutic areas and key industry trends. Our team of scientific experts actively monitors the evolving treatment landscape across many therapeutic areas and treatment modalities in order to identify new opportunities. We analyze a wide range of scientific data and stay in constant communication with leading physicians, scientists, biopharmaceutical executives and venture capital firms. This allows us to quickly assess and gain conviction in the value of assets when acquisition opportunities arise. Additionally, our focus on acquiring royalties on approved products, often in the early stages of their commercial launches, and on development-stage product candidates with strong proof of concept data, mitigates development risk and expands our opportunity set.

We take a disciplined approach in assessing opportunities and seek to acquire exposure to therapies based on our framework of key product success factors:

•Strong scientific rationale;

•Significant impact on patients and/or caregivers;

•Conviction in probability of clinical and regulatory success for pre-approval programs;

•Mission and execution-oriented management team;

•Strong marketer and global commercial opportunity;

•Clear commercial positioning;

•Potential for multiple indications or label expansion;

•First-in-class or best-in-class;

•Long duration of patent protection or exclusivity; and

•Compelling value proposition for government and commercial payors.

Our focus is to create significant long-term value for our shareholders by acquiring both approved and development-stage product candidates through a variety of structures. In evaluating these acquisition opportunities, we focus on the following financial characteristics:

•Attractive risk-adjusted returns: we focus on generating attractive returns on our investments on a risk-adjusted basis. We evaluate opportunities across approved products as well as development-stage product candidates, primarily post proof of concept, and target returns based on the risk spectrum.

•Long duration cash flows: we prioritize long-duration assets over short-duration assets that may boost near-term financial performance. The durability of our cash flows also allows us to add leverage to our portfolio, enhancing returns and providing capital that we can use to acquire additional assets.

•Growth and scale: we seek assets that drive value creation and are accretive to our long-term growth profile.

We conduct extensive due diligence when evaluating potential new opportunities. We have end-to-end capabilities that span clinical and commercial analysis, valuation and transaction structuring. We have a highly focused and experienced team that conducts proprietary primary market research, forms its own views on the clinical and commercial outlook for the product, and builds its own financial models, allowing us to generate direct insights and to take significant accountability and ownership for our investments. We invest significant time and resources across all levels of the organization, including senior leadership, in the evaluation of potential opportunities.

Approved Products

Portfolio Overview

The following table provides an overview of our current portfolio of royalties on approved products, including end market sales of the therapies in our portfolio:

Products

Marketer(s)

Therapeutic Area

Product Detail

~~2024~~2025 Portfolio Receipts (in millions)

~~2024~~2025 End Market Sales (in millions)(1)

Cystic fibrosis franchise(2)

Vertex

Rare disease

Cystic fibrosis

$~~857~~917

$11,~~020~~725

Trelegy

GSK

Respiratory

Chronic obstructive pulmonary disease and asthma

~~284~~332

3,~~456~~912

Tysabri

Biogen

Neuroscience

Relapsing forms of multiple sclerosis

~~262~~250

1,~~711~~665

Imbruvica

AbbVie, Johnson & Johnson

Cancer

Hematological malignancies and chronic graft versus host disease

191

4,466

Evrysdi

Roche

Rare disease

Spinal muscular atrophy

202

2,121

Evrysdi

Roche

Rare disease

Spinal muscular atrophy

174

1,853

Xtandi

Pfizer, Astellas

Oncology

Prostate cancer

197

6,297

Xtandi

Pfizer, Astellas

Cancer

Prostate cancer

169

5,906

Tremfya

Johnson & Johnson

Immunology

Plaque psoriasis, psoriatic arthritis, ulcerative colitis and Crohn’s disease

178

5,155

Promacta

Novartis

Hematology

Chronic immune thrombocytopenic purpura and aplastic anemia

158

2,216

Imbruvica

AbbVie, Johnson & Johnson

Oncology

Hematological malignancies and chronic graft versus host disease

170

3,979

Tremfya

Johnson & Johnson

Immunology

Plaque psoriasis, psoriatic arthritis and ulcerative colitis

140

3,670

Promacta

Novartis

Hematology

Chronic immune thrombocytopenic purpura and aplastic anemia

142

1,636

Cabometyx/Cometriq

Exelixis, Ipsen, Takeda

Cancer

Kidney, liver and thyroid cancers

2,483

Voranigo

Servier

Oncology

Brain Cancer

118

n/a(3)

Spinraza

Biogen

Rare disease

Spinal muscular atrophy

1,506

Cabometyx/Cometriq

Exelixis, Ipsen, Takeda

Oncology

Kidney, liver and thyroid cancers

2,993

Trodelvy

Gilead

Cancer

Breast cancer

1,300

Spinraza

Biogen

Rare disease

Spinal muscular atrophy

1,547

Erleada

Johnson & Johnson

Cancer

Prostate cancer

2,999

Trodelvy

Gilead

Oncology

Breast cancer

1,403

Orladeyo

BioCryst

Rare disease

Hereditary angioedema prophylaxis

437

Erleada

Johnson & Johnson

Oncology

Prostate cancer

3,574

Nurtec ODT/Zavzpret

Pfizer

Neuroscience

Migraine

1,263(3)

Imdelltra

Amgen

Oncology

Small cell lung cancer

627

Other products(4)

~~273~~381

—

Royalty Receipts

$23,~~771~~127

Milestones and other contractual receipts

31128

—

Portfolio Receipts

$2,801

Portfolio Receipts(5)

$3,254

Amounts shown in the table may not add due to rounding.

(1)Represents end market sales for ~~2024~~2025 as reported by respective product marketers or, where marketers have not reported end market sales by February 109, ~~2025~~2026, based on Visible Alpha projections as of February 10, ~~2025~~2026. For the majority of our royalties, Royalty Receipts lag product performance by one quarter and can generally be estimated by applying our publicly disclosed royalty rate to the preceding quarter’s marketer-announced net revenues on a product-by-product basis.

(2)The cystic fibrosis franchise includes the following approved products: Kalydeco, Orkambi, Symdeko/Symkevi, Trikafta/Kaftrio and Alyftrek~~, which was approved by the FDA in December 2024~~.

(3)~~Reflects~~Voranigo ~~2024 end market~~ sales ~~for Nurtec ODT. Zavzpret sales~~ are not disclosed by ~~Pfizer~~Servier.

(4)Other products primarily include royalties on the following products: ~~Cimzia,~~ Crysvita, Emgality, Entyvio, Farxiga/Onglyza, IDHIFA, Nesina, Nurtec ODT, Orladeyo, Prevymis, Soliqua and distributions from the Legacy SLP Interest, which are presented as Distributions from equity method investees on the Statements of Cash Flows.

(5)Portfolio Receipts does not include the $511 million of proceeds from our sale of the MorphoSys Development Funding Bonds because it was treated as an asset sale.

Portfolio Summary

The table below provides a summary of the acquisition year, estimated royalty duration, royalty rates and the ownership percentages attributable to Royalty Pharma, net of legacy non-controlling interests for selected approved products in our portfolio:

Products	Acquisition Year(s)	Estimated Royalty Duration(1)	Royalty Rates(2)	Attributable to Royalty Pharma(3)
Cystic fibrosis franchise(4)	2014, 2020	2039-2041	Blended royalty of slightly over 9% for Trikafta; See footnote (4)	86.58%
Trelegy(5)	2022	2029-2030	Tiered royalty of 6.5% on first $750 million, up to 10% on sales >$2.25 billion	100.0%
Tysabri	2017	Perpetual	Tiered payments of 18% on first $2 billion and 25% on sales >$2 billion	82.4%
Imbruvica	2013	2027-2032	Downward tiered mid-single digit royalty	82.4%
Evrysdi(6)	2020, 2023, 2024, 2025	2035-2036	Tiered royalty of 8% on first $500 million, up to 16% on sales >$2 billion	100.0%
Evrysdi(6)	2020, 2023, 2024	2035-2036	Tiered royalty of 7.2% on first $500 million, up to 14.5% on sales >$2 billion	100.0%
Xtandi	2016	2027-2028	Slightly less than 4% royalty	82.4%
Tremfya	2021	2031-2032	~4% royalty	100.0%
Imbruvica	2013	2027-2032	Downward tiered mid-single digit royalty	82.4%
Promacta	2019	2025-2028	Upward tiered 4.7% to 9.4% royalty	82.4%
Tremfya	2021	2031-2032	Upward tiered mid-single digit royalty	100.0%
Voranigo	2024	2038	Tiered royalty of 15% on first $1 billion of U.S. sales, down to 12% on U.S. sales >$1 billion	100.0%
Cabometyx/Cometriq(7)	2021	2026-2029	3% royalty	100.0%
Spinraza(8)	2023	2030-2035	Upward tiered 2.8% to 3.8% royalty, increasing to 5% to 6.8% in 2028	100.0%
Trodelvy	2018	Perpetual	Tiered royalty of 4.15% on first $2 billion, down to 1.75% on sales >$6 billion	82.4%
Erleada	2019, 2023	2032	Low-single digit royalty	86.72%
Orladeyo(9)	2020, 2021	2036-2039	Tiered royalty of 9.5% on first $350 million and 4.5% on sales up to $550 million	100.0%
Imdelltra(9)	2025	2038-2041	~7% royalty with royalty sharing on sales >$1.5 billion	100.0%
Nurtec ODT/Zavzpret	2018, 2020	2034-2036	Tiered royalty of ~2.5% on first $1.5 billion and ~1.9% on sales >$1.5 billion	86.7%

(1)Durations shown represent our estimates as of the current reporting date of when a royalty will substantially end, which may vary by geography and may depend on clinical trial results, regulatory approvals (including the timing of such approvals), contractual terms, commercial developments, estimates of regulatory exclusivity and patent expiration dates (which may include estimated patent term extensions) or other factors. There can be no assurances that our royalties will expire when estimated.

(2)The royalties in our portfolio are subject to the underlying contractual agreements from which they arise and may be subject to reductions or other adjustments in accordance with the terms of such agreements. Royalty rates apply to annual worldwide net sales unless otherwise stated.

(3)Ownership percentages for cystic fibrosis franchise, ~~Erleada~~ and ~~Nurtec~~Erleada ~~ODT/Zavzpret~~ represent blended percentages across multiple royalty interests based on ~~2024~~2025 Royalty Receipts.

(4)Royalty is perpetual. We estimate royalty duration of 2039-2041 due to expected Alyftrek patent expiration and potential generic entry thereafter leading to sales decline. We estimate expected Trikafta patent expiration in 2037 and potential generic entry thereafter leading to sales decline. For combination therapies, sales are allocated equally to each of the active pharmaceutical ingredients, with tiered royalties ranging from single digit to subteen percentages on sales of ivacaftor, lumacaftor and tezacaftor, and ~~mid-single~~4% ~~digit percentages~~ on sales of elexacaftor. We believe that deuterated ivacaftor (deutivacaftor) is the same as ivacaftor and is therefore royalty-bearing, which would result in a blended royalty of ~~approximately8~~approximately 8% for Alyftrek. Vertex has made public statements that it believes deuterated ivacaftor (deutivacaftor) is not royalty-bearing, which would result in a blended royalty of approximately 4% for Alyftrek.

(5)We will ~~pay~~return ~~Theravance~~to ~~Biopharma,~~GSK ~~Inc.~~ 85% of the royalties in respect of ex-U.S. sales after June 30, 2029 and 85% of the royalties in respect of U.S. sales after December 31, 2030. Royalties are tiered based on sales at 6.5% up to $750 million, 8% between $750 million and $1.25 billion, 9% between $1.25 billion and $2.25 billion, and 10% over $2.25 billion.

(6)Royalties are tiered based on sales at ~~7.2~~8% up to $500 million, 1011% between $500 million and $1 billion, ~~12.7~~14% between $1 billion and $2 billion, and ~~14.5~~16% over $2 billion. ~~Our royalty rates are expected to be reduced by 8% in the early 2030s. Royalty entitlement does not reflect PTC exercising the option to sell its remaining 9.5% of the Evrysdi royalty.~~

(7)We are entitled to royalties on U.S. sales of cabozantinib products through September 2026 and non-U.S. markets through the full term of the royalty.

(8)Our royalty interest in Spinraza will revert to Ionis after we receive aggregate Spinraza royalties equal to $475 million or $550 million, depending on the timing and occurrence of certain events. We are entitled to 25% of Ionis’ Spinraza royalty payments of 11% to 15% on sales up to $1.5 billion through 2027, increasing to 45% of royalty payments on sales up to $1.5 billion in 2028.

(9)~~Royalty is perpetual. Years shown represent estimated U.S. patent expiration for Orladeyo and potential generic entry thereafter leading to sales decline.~~ We are ~~also~~ entitled to aroyalties ~~tiered~~on ~~percentage~~worldwide ofnet ~~sublicense~~sales ~~revenue~~of ~~for~~Imdelltra, ~~Orladeyo~~excluding sales in ~~certain territories~~China.

There can be no assurance that our royalties will expire when expected. Any reductions in the durations of royalties relative to our estimates may adversely affect our financial condition or results of operations. See “Risk Factors” in Item 1A, Risk Factors for further information.

Other Recent Royalty Acquisitions and Key Developments on Recently Approved Products

•In December 2024, Vertex announced the FDA approval of the new triple-combination modulator Alyftrek (vanzacaftor triple) for treatment of cystic fibrosis in people ages 6 and older with at least one responsive mutation.

~~•In~~Other ~~November~~Recent ~~2024,~~Royalty weAcquisitions ~~acquired~~and aKey ~~synthetic~~Developments ~~royalty~~ on ~~Rytelo~~Recently ~~from~~Approved Geron Corporation for an upfront payment of $125 million. Rytelo is approved for the treatment of certain adult patients low- to intermediate-1 risk myelodysplastic syndromes with transfusion-dependent anemia. Following the acquisition, we are entitled to receive royalties on the U.S. net sales on Rytelo.Products

•In ~~November~~December ~~2024~~2025, weCytokinetics ~~acquired~~announced aFDA ~~synthetic~~approval ~~royalty~~of ~~on Niktimvo from Syndax Pharmaceuticals~~Myqorzo, ~~Inc.~~formerly ~~for~~known anas ~~upfront payment of $350 million~~aficamten. ~~Niktimvo is approved for the treatment of chronic graft-versus-host disease and will be co-commercialized by Incyte. We expect to receive royalties on the U.S. net sales of Niktimvo beginning in 2025.~~

•In ~~September~~November ~~2024~~2025, ~~Bristol~~we ~~Myers~~acquired ~~Squibb~~a ~~announced~~royalty ~~the~~interest ~~FDA~~in ~~approval~~Alnylam’s ofAmvuttra ~~Cobenfy~~from ~~(formerly~~Blackstone ~~KarXT),~~for a$310 ~~first-in-class~~million. ~~muscarinic~~Amvuttra ~~agonist~~is an approved ribonucleic acid interference (“RNAi”) therapeutic for the treatment of ~~schizophrenia~~transthyretin in(“TTR”) ~~adults~~amyloidosis with cardiomyopathy and for hereditary TTR amyloidosis with polyneuropathy.

•In September 2024, we acquired a synthetic royalty on Yorvipath from Ascendis Pharma A/S for an upfront payment of $150 million. Yorvipath is approved for the treatment of hypoparathyroidism in adults. We expect to receive royalties on Yorvipath beginning in 2025.

•In May 2024, we announced a transaction to acquire a royalty interest in Voranigo from Agios Pharmaceuticals for an upfront payment of $905 million contingent on FDA approval. In August 2024, we made the upfront payment following the FDA approval on Voranigo.

•In September 2023, we acquired a royalty interest in Skytrofa for an upfront payment of $150 million. Skytrofa is approved for the treatment of pediatric patients with growth failure due to inadequate secretion of endogenous growth hormone. We expect to receive royalties on Skytrofa beginning in 2025.

Development-Stage Product Candidates

The table below provides a summary of our portfolio of development-stage product candidates, which have not been approved and therefore have not generated any royalties (and we have not collected any related Royalty Receipts) to date:

Product Candidates

Marketer(s)

Therapeutic Area

Status(1)

Product Description

Aficamten

Cytokinetics

Cardiology

PDUFA date Q3 2025

Cardiac myosin inhibitor for obstructive hypertrophic cardiomyopathy

Ampreloxetine

Theravance

Neuroscience

Phase 3 data expected Q1 2026

Once-daily norepinephrine reuptake inhibitor for symptomatic neurogenic orthostatic hypotension in patients with multiple system atrophy

Ampreloxetine

Theravance

Neuroscience

Phase 3 data expected 2026

Once-daily norepinephrine reuptake inhibitor for symptomatic neurogenic orthostatic hypotension in patients with multiple system atrophy

CK-586

Cytokinetics

Cardiology

Phase 2

Cardiac myosin inhibitor to reduce the hypercontractility associated with heart failure with preserved ejection fraction

Deucrictibant

Pharvaris

Rare disease

Phase 3 data expected 2026

Novel, oral bradykinin B2 receptor antagonist for preventing and treating hereditary angioedema attacks

Daraxonrasib

Revolution Medicines

Oncology

Phase 3 data expected H1 2026

Oral RAS(ON) multi-selective inhibitor for pancreatic and lung cancer

Ecopipam

Emalex

Neuroscience

Phase 3 data expected 2025

Oral dopamine-1 receptor antagonist for Tourette’s Syndrome

Deucrictibant

Pharvaris

Rare disease

FDA filing expected H1 2026

Novel, oral bradykinin B2 receptor antagonist for preventing and treating hereditary angioedema attacks

Frexalimab

Sanofi

Immunology

Phase 3 data expected 2027

Anti-CD40 ligand monoclonal antibody

Ecopipam

Emalex

Neuroscience

FDA filing expected

Oral dopamine-1 receptor antagonist for Tourette’s syndrome

Frexalimab

Sanofi

Immunology

Phase 3 data expected 2027

Anti-CD40 ligand monoclonal antibody for multiple sclerosis

Litifilimab

Biogen

Immunology

Phase 3 data expected Q4 2026

Humanized IgG1 monoclonal antibody targeting BDCA2 for lupus

Neladalkib

Nuvalent

Oncology

FDA filing expected H1 2026

Next-generation TKI for ALK mutation-positive non-small cell lung cancer

Obexelimab

Zenas BioPharma

Immunology

FDA filing expected Q2 2026

Bifunctional monoclonal antibody designed to inhibit B cell function by binding to both CD19 and FcγRIIb for IgG4-RD

Olpasiran

Amgen

Cardiology

Phase 3 data expected 2027

Small interfering ribonucleic acid for elevated lipoprotein(a), a genetically determined independent risk factor for cardiovascular disease

Omecamtiv mecarbil

Cytokinetics

Cardiology

Phase 3 data expected 2027

Cardiac myosin activator for the treatment of heart failure with severely reduced ejection fraction

Pelabresib

Novartis

~~Cancer~~Oncology

~~Phase~~EMA 3filing expected 2026

Bromodomain and extra-terminal inhibitor for myelofibrosis

Pelacarsen

Novartis

Cardiology

Phase 3 data expected H2 2026

Antisense oligonucleotide for elevated lipoprotein(a), a genetically determined independent risk factor for cardiovascular disease

Seltorexant

Johnson & Johnson

Neuroscience

Phase 3 data expected 2027

Selective orexin 2 receptor antagonist for major depressive disorder with insomnia symptoms

TEV-'749

Teva

Neuroscience

~~Phase~~FDA 3approval ~~data~~ expected ~~2025~~H2 2026

Long-acting subcutaneous injection of olanzapine for schizophrenia

Trontinemab

Roche

Neuroscience

Phase 1a/2b

Novel Brainshuttle Aβ antibody for the treatment of Alzheimer’s disease

TEV-'408(2)

Teva

Immunology

Phase 1b data expected H1 2026

Anti-IL-15 antibody for the treatment of vitiligo and other autoimmune conditions

Tulmimetostat

Novartis

Cancer

Phase 2

Second-generation enhancer of zeste homolog 2 inhibitor for hematological malignancies and solid tumors

Tividenofusp alfa

Denali

Rare disease

PDUFA date April 5, 2026

Enzyme replacement therapy designed to cross the blood-brain barrier for MPS II, or Hunter syndrome

Trontinemab

Roche

Neuroscience

Phase 3 data expected 2028

Novel Brainshuttle Aβ antibody for the treatment of Alzheimer’s disease

Tulmimetostat

Novartis

Oncology

Phase 2

Second-generation enhancer of zeste homolog 2 inhibitor for hematological malignancies and solid tumors

Zidesamtinib

Nuvalent

Oncology

PDUFA date September 18, 2026

Next-generation TKI for ROS1 mutation-positive non-small cell lung cancer

PDUFA: Prescription Drug User Fee Act, ROS1: ROS proto-oncogene 1, IgG1: Immunoglobulin G1, ALK: Anaplastic Lymphoma Kinase, TKI: Tyrosine Kinase Inhibitor, CD: Cluster of Differentiation, FcγRIIb: Fc gamma Receptor IIB, IgG4: Immunoglobulin G4 related disease, EMA: European Medicines Agency, MPS II: Mucopolysaccharidosis type II, RAS: Rat Sarcoma, IL: Interleukin.

(1)Based on information disclosed by marketer of the underlying product and information available on clinicaltrials.gov as of February 101, ~~2025~~2026.

10(2)We entered into a funding agreement with Teva Pharmaceuticals for TEV-’408 in January 2026.

Other Significant Funding Arrangements

The table below provides a summary of our significant contractual funding arrangements and related funding status as of December 31, ~~2024~~2025 (in ~~thousands, unless otherwise stated~~millions):

	Funded		Required Future Draw		Potential Future Draw		Total		Total Repayments Based on Amounts Funded		Payments Received to Date
Cytokinetics Commercial Launch Funding(1)	$~~100,000~~	275	$~~50,000(2)~~	—	$~~250,000(2)~~	175	$~~400,000~~	450	$~~190,000~~	523	$~~11,520~~	23
Cytokinetics Development Funding(3)	100,000		—		—		100,000		Refer to footnote (3)		Refer to footnote (3)
Cytokinetics Development Funding(2)	100		—		—		100		Refer to footnote(2)		—
MorphoSys Development Funding Bonds	300,000		—		—		300,000		Refer to footnote (4)		Refer to footnote (4)
Teva Development Co-Funding Arrangement for TEV-’749(3)	100		—		—		100		100(3)		—
Teva Development Co-Funding Arrangement(5)	100,000		—		—		100,000		$100 million or $125 million		—
Biogen R&D Funding Arrangement for Litifilimab(4)	200		50				250		Refer to footnote(4)		—
Revolution Medicines Funding Arrangement
Royalty(5)	250		250		750		1,250		Refer to footnote(5)		—
Term loan(6)	—		250		500		750		N/A - no amounts funded to date		—

(1)~~Comprised~~Out of the seven tranches, ofwe ~~which~~have ~~tranches~~funded ~~one~~a ~~and~~total ~~six, each~~ of $50 275 million under tranches one, ~~were~~four, ~~funded~~five and six. Quarterly payments on tranche one began in the fourth quarter of 2023 and continue through the first quarter of 2032. Quarterly payments on tranche four will begin in the first quarter of 2027 and continue through the second quarter of 2035. Quarterly payments on tranche five will begin in the third quarter of 2027 and continue through the fourth quarter of 2035. Quarterly payments on tranche six will begin in the first quarter of 2026 and continue through the second quarter of 2034.

(2)~~Potential~~If ~~future~~a ~~draw~~Phase 3 trial of ~~$250~~omecamtiv ~~million~~mecarbil ~~assumes~~is ~~that~~positive noand ~~more~~FDA ~~than~~approval ~~$25~~is ~~million~~received ~~will~~within bea ~~drawn~~specific ~~under~~timeframe, ~~tranche~~we 4.will Upreceive topayments of $75100 million isand ~~available~~the togreater beof ~~drawn~~an ~~under~~incremental ~~tranche~~2% 4royalty ~~until~~on ~~April~~omecamtiv ~~2025~~mecarbil, ~~and~~or upquarterly fixed payments ranging from $5 million to $~~100~~8 million isper ~~available~~quarter tofor be18 ~~drawn~~quarters ~~under~~and ~~tranche~~an 5incremental ~~until~~2% ~~December~~royalty ~~2025~~thereafter. AAlternatively, ~~minimum~~if ofFDA ~~$50~~approval ~~million~~ is ~~required~~not toreceived bewithin ~~drawn~~a ~~under~~specific ~~either~~timeframe, ~~tranche~~we 4will orreceive ~~tranche~~18 5.quarterly ~~The~~fixed ~~condition~~payments ~~for~~totaling $~~175~~240 million. toAlternatively, ~~become~~if ~~available~~a toPhase be3 ~~drawn~~clinical ~~under~~trial ~~tranche~~is 7not ~~has~~positive ~~not~~within ~~yet~~a ~~been~~specific ~~satisfied~~timeframe, we will receive 22 quarterly fixed payments totaling $230 million.

(3)If aTEV-'749 ~~Phase 3 trial of omecamtiv mecarbil~~ is ~~positive~~approved ~~and~~by ~~FDA~~the ~~approval is received within a specific timeframe~~FDA, we will receive payments of $100 million ~~and~~in ~~the~~addition ~~greater of an incremental 2% royalty on omecamtiv mecarbil, or quarterly fixed payments ranging from $5 million~~ to $8tiered ~~million per quarter for 18 quarters and an incremental 2%~~ royalty ~~thereafter. Alternatively, if FDA approval is not received within a specific timeframe, we will receive 18 quarterly fixed~~ payments ~~totaling~~based ~~$240~~on ~~million.~~worldwide ~~Alternatively,~~sales ifof ~~a Phase 3 clinical trial is not positive within a specific timeframe, we will receive 22 quarterly fixed payments totaling $230 million~~TEV-'749.

(4)InWe ~~January~~will ~~2025,~~provide ~~the~~funding ~~MorphoSys~~of ~~Development Funding Bonds were sold for approximately~~ $~~511~~250 million. ~~The~~over ~~$511~~six ~~million~~quarters ~~will be treated as an asset sale~~ and will ~~not~~receive bepayments ~~included~~of asup ~~Portfolio Receipts. Prior~~ to ~~the~~$250 ~~sale,~~million weif ~~received~~certain ~~two~~regulatory ~~quarterly~~milestones ~~payments~~are ofmet ~~$19.4~~plus ~~million in total~~royalties.

(5)IfWe ~~TEV-'749~~will isprovide ~~approved~~funding byin ~~the~~five ~~FDA,~~$250 wemillion ~~will~~tranches ~~receive~~in ~~payments~~exchange for tiered royalties on annual worldwide net sales of ~~$100~~daraxonrasib ~~million~~(and zoldonrasib if approved in ~~addition~~an tooverlapping ~~tiered~~daraxonrasib ~~royalty~~indication). ~~payments~~Tranche ~~based~~one onwas ~~worldwide~~funded ~~sales~~in ofJune ~~TEV-'749~~2025. IfRevolution ~~Teva~~Medicines ~~chooses~~is ~~not~~required to ~~file~~draw athe ~~New~~second ~~Drug~~tranche ~~Application~~upon ~~with~~ the ~~FDA~~occurrence ~~following~~of ~~positive~~a ~~Phase~~certain 3clinical ~~study~~milestone ~~results~~and ofhas ~~TEV-‘749,~~the weoption ~~will~~to ~~receive~~draw athe ~~payment~~remaining tranches upon the achievement of ~~$125~~certain ~~million.~~clinical, regulatory or sales-based milestones.

(6)The term loan is comprised of three $250 million tranches at SOFR plus 5.75% (3.5% SOFR floor) which mature six years after the first tranche is drawn. Revolution Medicines is required to draw the first tranche upon the occurrence of a certain regulatory milestone and has the option to draw the remaining tranches upon the achievement of certain sales-based milestones.

Competition

We face competition from other ~~entities~~parties that acquire biopharmaceutical royalties~~, including competitors of the Manager that are in the similar business of acquiring biopharmaceutical royalties~~. There are a limited number of suitable and attractive acquisition opportunities available in the market. Therefore, competition to acquire such assets is ~~intense.~~significant ~~The~~and ~~Manager~~may isincrease. ~~subject~~We tocompete ~~competition~~with ~~from~~a ~~other~~broad ~~potential~~range ~~royalty~~of ~~buyers~~potential acquirers, including ~~from~~biopharmaceutical ~~the~~ companies that market the products on which royalties are paid, investment vehicles and other pools of capital, financial institutions, ~~investment~~institutional investors, including sovereign wealth and pension funds, and other ~~entities~~market participants. These other potential royalty buyers may be larger and better capitalized than us. ~~The~~We ~~Manager~~ may not be able to identify and obtain a sufficient number of asset acquisition opportunities to invest the full amount of capital that may be available to us. We also compete with other forms of financing available to biopharmaceutical companies, such as equity, debt or convertible debt financing and licensing opportunities. If biopharmaceutical companies opt to finance through such other means, we may not be able to acquire additional assets or grow our business. There can be no assurance that we will continue to acquire biopharmaceutical products and companies that hold biopharmaceutical royalties that are acceptable to us.

The products that provide the basis for the cash flows of the biopharmaceutical products in which we invest are also subject to intense competition. The biopharmaceutical industry is a highly competitive and rapidly evolving industry. The length of any product’s commercial life cannot be predicted. There can be no assurance that one or more products will not be rendered obsolete or non-competitive by new or alternate products or improvements made to existing products, either by the current marketer of such products or by another marketer. Adverse competition, obsolescence, governmental and regulatory action, or healthcare policy changes could significantly affect the revenues, including royalty-related revenues, of the products which serve as the security or other support for the payments due under the biopharmaceutical products that we hold.

Competitive factors affecting the market position and success of each product include:

• safety, side effect profile, effectiveness and market acceptance;

• safety and side effect profile;

• price, including third-party insurance reimbursement policies;

• timing, introduction and marketer support of the product;

• efficacy and execution of marketing and commercialization strategy;

• market acceptance;

• manufacturing, supply and distribution;

• governmental regulation, including price caps;

• availability of lower-cost generics or biosimilars or other alternative treatments;

• intellectual property protection and exclusivity;

• treatment innovations that eliminate or minimize the need for a product; and

• product liability claims.

Products for which we have a royalty receivable or other interest may be rendered obsolete or non-competitive by new or alternate products, including generics or biosimilars, improvements on existing products or governmental or regulatory action. In addition, as biopharmaceutical companies increasingly devote significant resources to innovate next-generation products and therapies, products on which we have a royalty may become unattractive to commercialize or obsolete. If a product’s market acceptance is diminished or it is withdrawn from the market, continuing payments with respect to biopharmaceutical products, including royalty payments and payments of interest on and repayment of the principal, may not be made on time or at all, which may affect our ability to realize the benefits of the royalty receivable or other interest in such product and may result in us incurring asset impairment charges. Further, any product for which we have a royalty receivable or other interest that competes with an approved product must demonstrate compelling advantages in efficacy, convenience, tolerability and safety in order to overcome price competition and to be commercially successful. Many approved drugs are well established therapies and are widely accepted by physicians, patients and third-party payors. Insurers and other third-party payors may also encourage the use of generic products. Any of these developments could adversely affect products for which we have a royalty, and consequently could adversely affect our business, financial condition or results of operations.

Corporate Responsibility

Our mission is to accelerate innovation in life sciences and thereby positively impact patient lives globally. To accomplish this, we partner with innovators such as academic institutions, research hospitals, nonprofits and companies at the forefront of discovering lifesaving therapies to improve human health through solutions tailored to the needs of our partners. We believe that our corporate responsibility strategy, policies and practices will create sustainable long-term value for our company, our employees, our shareholders and other stakeholders, while also helping us reduce risk and identify new opportunities.

We maintain robust governance policies and practices that adhere to high standards of regulatory compliance, ethics, transparency and integrity. Our Board believes that its independence from and oversight of management are maintained effectively through its leadership structure, composition and sound corporate governance policies and practices.

We support expanding patient access to health care and medicine by providing funding to organizations addressing unmet patient needs through innovation and engaging in philanthropic activities. We incorporate material corporate responsibility, regulatory, geopolitical and reputational considerations, including access to health and medicine, research and development, ethical clinical trials, therapeutic area profile, ethical conduct and product quality and safety into our investment decision-making and management practices. This includes considering key risks and opportunities during the due diligence process and, where we believe we can have a material impact, engaging on these matters with our partners.

We are committed to implementing key sustainability practices across our operations and taking steps to measure, manage and minimize our environmental impact where possible. We believe that sustainability is critical to addressing related risks and opportunities for our business. We are focused on tracking our carbon footprint, mitigating our impact through energy efficiency and identifying ways to reduce our environmental impact.

Employees

~~Our~~As ~~directors~~of ~~and~~December ~~executive~~31, ~~officers~~2025, ~~manage~~we ~~our~~had ~~operations~~100 ~~and activities~~employees. ~~However,~~None weof doour ~~not~~employees ~~currently~~are ~~have~~represented ~~any~~by ~~employees~~labor unions or covered by any ~~officers~~collective ~~other~~bargaining ~~than~~agreement. ~~our~~We ~~executive~~believe ~~officers.~~relations ~~Pursuant~~with toour ~~the~~employees ~~management~~are ~~agreements~~satisfactory. ~~entered~~In ~~into~~May in2025, ~~connection~~we ~~with~~completed the acquisition of our ~~initial~~former ~~public~~external ~~offering~~manager (~~collectively,~~ the “~~Management Agreement~~Internalization”) and became an integrated company with ~~the~~all ~~Manager,~~employees of the ~~Manager~~former ~~performs~~manager ~~corporate~~becoming ~~and~~employees ~~administration~~of ~~services~~Royalty ~~for~~Pharma, ~~us.~~LLC, a wholly-owned subsidiary of RP Holdings.

As of December 31, 2024, the Manager had 99 employees. None of these employees are represented by labor unions or covered by any collective bargaining agreement. We believe that the Manager’s relations with its employees are satisfactory.

Human Capital

~~Because~~Our weability ~~are~~to ~~“externally~~hire ~~managed,”~~and weretain dotop ~~not~~talent ~~employ~~is ~~our~~a ~~own~~driving ~~personnel,~~force ~~but~~behind ~~instead~~our ~~depend~~culture. ~~upon~~We ~~the~~are ~~Manager~~focused ~~and~~on ~~its~~creating ~~executive~~a ~~officers~~supportive and ~~employees~~values-based ~~for~~organization ~~all~~where ofour ~~the~~employees ~~services~~can ~~we require~~thrive. ~~Under~~We ~~the~~continue ~~Management~~to ~~Agreement,~~invest ~~the~~in ~~Manager manages the assets of~~ our ~~business~~workplace ~~and~~culture ~~sources~~ and ~~evaluates~~support ~~royalty acquisitions. Accordingly,~~ our ~~success~~employees isacross ~~dependent~~many ~~upon~~facets ~~the expertise and services~~ of ~~the~~wellness ~~executive officers~~ and ~~other~~personal ~~personnel provided to us through the Manager~~development. ~~The~~As ~~Manager is responsible for the selection~~ of ~~these~~December ~~executive~~31, ~~officers and other personnel~~2025, ~~and~~48% ~~our Board~~ of ~~Directors reviews personnel with~~ the ~~Manager~~workforce ~~with~~are ~~the~~women ~~objective of evaluating the Manager’s internal capabilities. The Management Development~~ and ~~Compensation~~approximately ~~Committee~~36% of ~~our Board of Directors in consultation with~~ the ~~Manager~~workforce ~~also plans for the succession~~ of ~~senior~~are ~~management~~ethnically ~~of the Manager~~diverse. The Management Agreement requires the Manager’s executives to devote substantially all of their time to managing us, Royalty Pharma Investments 2019 ICAV (“RPI 2019 ICAV”) and any legacy vehicles related to Royalty Pharma Investments, an Irish unit trust (“Old RPI”) unless otherwise approved by our Board of Directors.

The Manager is focused on creating a supportive and values-based culture that elevates health, well-being and growth. The Manager values diverse teams and backgrounds: as of December 31, 2024, 48% of the workforce of our Manager are women and approximately 33% of the workforce of our Manager are ethnically diverse.

In January 2025, we agreed to acquire the Manager for approximately $1.1 billion in total consideration (the “Internalization”). The Internalization is expected to close in the second quarter of 2025 subject to shareholder approval. Following the Internalization, we would cease to be externally managed and would operate as an integrated company with all employees of the Manager becoming employees of the Company. We expect the Internalization would enhance corporate governance and employee retention with a significant equity component of the consideration.

Governmental Regulation and Environmental Matters

Our business has been and will continue to be subject to numerous laws and regulations. Failure to comply with these laws and regulations could subject us to administrative and legal proceedings and actions by various governmental bodies. See “Risk Factors” in Item 1A, Risk Factors for further information. Our compliance with these laws and regulations has not had a material impact on our capital expenditures, earnings, financial condition or competitive position in excess of those affecting others in our industry.

We believe that there are no compliance issues with laws and regulations that have been enacted or adopted regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, that have adversely affected, or are reasonably expected to adversely affect, our business, financial condition or results of operations, and we do not currently anticipate material capital expenditures arising from environmental regulation. We believe that climate change could present risks to our business. Some of the potential impacts of climate change to our business include increased operating costs due to additional regulatory requirements and the risk of disruptions to our business. We do not believe these risks are material to our business at this time.

U.S. Investment Company Act Status

We intend to conduct our business so as not to become regulated as an investment company under the U.S. Investment Company Act. An entity generally will be determined to be an investment company for purposes of the U.S. Investment Company Act if, absent an applicable exemption, (i) it is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities or (ii) it owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis, which we refer to as the ICA 40% Test.

We do not hold ourselves out as being engaged primarily, or propose to engage primarily, in the business of investing, reinvesting or trading in securities, and believe that we are not engaged primarily in the business of investing, reinvesting or trading in securities. We believe that, for U.S. Investment Company Act purposes, we are engaged primarily, through one or more of our subsidiaries, in the business of purchasing or otherwise acquiring certain obligations that represent part or all of the sales price of merchandise. Our subsidiaries that are so engaged rely on Section 3(c)(5)(A) of the U.S. Investment Company Act, which, according to certain SEC staff interpretations, generally may be available to an issuer that invests at least 55% of its assets in “notes, drafts, acceptances, open accounts receivable, and other obligations representing part or all of the sales price of merchandise, insurance, and services,” which we refer to as ICA Exception Qualifying Assets, and that does not issue any redeemable securities, face-amount certificates of the installment type or periodic payment plan certificates.

In a no-action letter, dated August 13, 2010, to our predecessor, the SEC staff promulgated an interpretation that royalties that entitle an issuer to collect royalty receivables that are directly based on the sales price of specific biopharmaceutical assets that use intellectual property covered by specific license agreements are ICA Exception Qualifying Assets under Section 3(c)(5)(A). We rely on this no-action letter for the position that royalty receivables relating to biopharmaceutical assets that we hold are ICA Exception Qualifying Assets under Section 3(c)(5)(A) and Section 3(c)(6), which is described below.

As the parent of one or more subsidiaries that rely on Section 3(c)(5)(A), we currently are exempted from registration as an investment company based on Section 3(a)(1)(C) and/or Section 3(c)(6) of the U.S. Investment Company Act. To ensure that we are not obligated to register as an investment company, we must not exceed the thresholds provided by the ICA 40% Test. For purposes of the ICA 40% Test, the term “investment securities” does not include U.S. government securities or securities issued by majority-owned subsidiaries that are not themselves investment companies and are not relying on Section 3(c)(1) or Section 3(c)(7) of the U.S. Investment Company Act, such as majority-owned subsidiaries that rely on Section 3(c)(5)(A). We also may rely on Section 3(c)(6), which, based on SEC staff interpretations, requires us to invest, either directly or through majority-owned subsidiaries, at least 55% of our assets in, as relevant here, businesses relying on Section 3(c)(5)(A). For a subsidiary to be “majority-owned,” a parent entity must own a majority of the voting securities of the applicable security. Therefore, the assets that we and our subsidiaries hold and acquire are limited by the provisions of the U.S. Investment Company Act and the rules and regulations promulgated thereunder.

If the SEC or its staff in the future adopts a contrary interpretation to that provided in the no-action letter to Royalty Pharma or otherwise restricts the conclusions in the SEC staff’s no-action letter such that royalties are no longer treated as ICA Exception Qualifying Assets for purposes of Section 3(c)(5)(A) and Section 3(c)(6), or the SEC or its staff in the future determines that the no-action letter does not apply to some or all types of royalty receivables relating to biopharmaceutical assets, our business will be materially and adversely affected. In particular, we would be required either to convert to a corporation formed under the laws of the United States or a state thereof (which would likely result in our being subject to U.S. federal corporate income taxation) and to register as an investment company, or to stop all business activities in the United States until such time as the SEC grants an application to register us as an investment company formed under non-U.S. law. It is unlikely that such an application would be granted and, even if it were, requirements imposed by the Investment Company Act, including limitations on our capital structure, our ability to transact business with affiliates and our ability to compensate key employees, could make it impractical for us to continue our business as currently conducted. Our no longer qualifying for an exemption from registration as an investment company would materially and adversely affect the value of your Class A ordinary shares and our ability to pay dividends in respect of our Class A ordinary shares.

Corporate Information

Our predecessor was founded in 1996 and we were incorporated under the laws of England and Wales on February 6, 2020. We are a holding company and our principal asset is a controlling equity interest in Royalty Pharma Holdings Ltd (“RP Holdings”). Our principal executive offices are located at 110 East 59th Street, New York, NY 10022, and our telephone number is (212) 883-0200. Our internet site is www.royaltypharma.com. Our website and the information contained therein or connected thereto is not incorporated into this Annual Report on Form 10-K. Our agent for service in the United States is CSC North America located at 251 Little Falls Drive, Wilmington, DE 19808.

Available Information

Our reports filed with or furnished to the SEC pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, are available, free of charge, on the Investors section of our website at https://royaltypharma.com as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The SEC maintains a website at http://www.sec.gov that contains reports, and other information regarding us and other companies that file materials with the SEC electronically. We use the Investor section of our website as a means of disclosing material information. Accordingly, investors should monitor our website, in addition to following our press releases, SEC filings, and public conference calls and webcasts. Statements and information concerning our status as a Passive Foreign Investment Company (“PFIC”) for U.S. taxpayers are also available, free of charge, on the Investors section of our website under “Tax Information.” The information contained on or connected to the websites referenced in this Annual Report on Form 10-K is not incorporated by reference into this filing. Further, references to website URLs are intended to be inactive textual references only.

Item 1A. RISK FACTORS

Described below are certain risks that we believe apply to our business. You should carefully consider the following information about these risks, together with the other information contained in this Annual Report on Form 10-K, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business.

Summary of Risk Factors

Our business is subject to a number of risks, including risks that may adversely affect our business, financial condition or results of operations. These risks are discussed more fully below and include, but are not limited to, risks related to:

Risks Relating to Our Business

•risks related to sales of biopharmaceutical products on which we receive royalties;

•risks related to the growth and dynamics of the royalty market;

•~~the~~uncertainties ~~ability~~related ~~of the Manager~~ to ~~identify~~acquiring ~~suitable~~interests ~~assets~~in ~~for~~development-stage usbiopharmaceutical toproduct ~~acquire~~candidates;

•~~uncertainties~~potential ~~related~~strategic toacquisitions ~~the acquisition~~ of ~~interests~~operating ~~in development-stage~~ biopharmaceutical ~~product candidates and our strategy to add interests in development-stage product candidates to our product portfolio~~companies;

•potential strategic acquisitions of biopharmaceutical companies;

•our use of leverage in connection with our capital deployment;

•our ability to leverage our competitive strengths;

•~~marketers~~our ofability ~~products~~to ~~that~~ generate ~~our~~increasing ~~royalties~~royalty ~~are~~receipts ~~outside~~and ofto ~~our~~achieve ~~control~~attractive ~~and~~returns ~~are~~on ~~responsible~~our ~~for development~~investments, ~~pursuit~~including maintaining attractive internal rates of ~~ongoing~~return ~~regulatory~~and ~~approval,~~consistent ~~commercialization,~~returns ~~manufacturing~~on invested capital and ~~marketing~~returns on invested equity;

•marketers of products that generate our royalties are outside of our control;

•disputes with our partners or payors of our royalties;

•governmental regulation of the biopharmaceutical industry;

•interest rate risk, foreign exchange fluctuations and inflation;

•the assumptions underlying our business model;

•the competitive nature of the biopharmaceutical industry;

Risks Relating to Our Organization and Structure

•our organizational structure, including our status as a holding company;

•our ~~reliance~~ability onto ~~the~~attract ~~Manager~~and ~~for~~retain ~~all~~highly ~~services~~talented ~~we require, including our reliance on key members of the Manager’s senior advisory team~~professionals;

•~~actual~~we ~~and~~may ~~potential~~not ~~conflicts~~realize ofthe ~~interest~~anticipated ~~with~~benefits of the ~~Manager~~Internalization and ~~its~~we ~~affiliates~~may be exposed to new risks and costs;

•the ability of the Manager or its affiliates to attract and retain highly talented professionals;

Risks Relating to Our Internalization

•the Internalization may not close due to a variety of factors, including the failure or significant delay in obtaining regulatory approvals, and, even if it does close, we may not realize the anticipated benefits;

•the Share Consideration in connection with the Internalization, and future sales of our Class A ordinary shares by the Sellers may adversely affect the market price of our Class A ordinary shares;

•certain of our officers and directors have interests in the Internalization that are different from, and may potentially conflict with, the interests of us and our shareholders;

•the exposure to risks to which we have not historically been exposed, including liabilities with respect to the assets acquired from the Manager;

Risks Relating to Our Class A Ordinary Shares

•volatility of the market price of our Class A ordinary shares;

•our incorporation under English law;

Risks Relating to Taxation

•the effect of changes to tax legislation and our tax position;

General Risk Factors

•cyber-attacks, data breaches or other failures in ~~telecommunications or~~ information technology systems; and

•~~the~~legal ~~outbreak~~claims ofand ~~any~~proceedings ~~infectious~~that could adversely affect our business, financial condition or ~~contagious~~results ~~diseases~~of operations.

Risks Relating to Our Business

Biopharmaceutical products are subject to sales risks.

Biopharmaceutical product sales may be lower than expected due to a number of reasons, including pricing pressures, insufficient demand, product competition, failure of clinical trials, delays or failures in obtaining marketing approval in one or more jurisdictions or for additional product indications, lack of market acceptance, changes in the marketer’s strategic priorities, obsolescence, lack of ~~acceptance~~coverage or insufficient reimbursement by healthcare programs or insurance plans, loss of patent protection, government regulations orand other factors,. ~~and development~~Development-stage product candidates may also fail to reach the market. Unexpected side effects, safety or efficacy concerns ~~can~~may arise ~~with respect to a product,~~ leading to product recalls, withdrawals, diminishing prescribing by physicians, declining reimbursement rates or sales, or litigation. As a result, payments of our royalties may be reduced, delayed or ceased~~. In addition~~, ~~these~~which ~~payments~~could ~~may~~adversely beaffect ~~delayed, causing~~ our near-term financial performance, tointernal berates ~~weaker~~of ~~than~~return, ~~expected~~returns on invested capital and returns on invested equity or long-term outlook.

The royalty market may not grow at the same rate as it has in the past, or at all, and we may not be able to acquire sufficient royalties to sustain the growth of our business.

We have ~~been~~historically ~~able~~grown ~~to grow~~ our business ~~over time~~ by primarily acquiring royalties. However, we may not be able to identify and acquire a sufficient number of royalties, or royalties of sufficient scale, to invest the ~~full amount of~~ capital ~~that may be~~ available to us ~~in the future, or~~ at our targeted ~~amount and~~ rate of capital deployment, which could prevent us from executing our growth strategy and negatively impact our business. Changes in the royalty market, including its structure, participants, growth rate, changes in preferred methods of financing and capital raising in the biopharmaceutical industry, or a reduction in the growth of the biopharmaceutical industry, could lead to diminished opportunities for us to acquire royalties, fewer royalties (or fewer royalties of significant scale) being available, or increased competition for royalties. Even if we continue to acquire royalties, they generally will not generate a meaningful return for ~~a period of~~ several years, if at all, due to transaction structures, circumstances relating to the underlying products or other factors. As a result, we may not be able to continue to acquire royalties or otherwise grow our business as we have in the past, or at all.

Acquisitions of royalties from our investments in development-stage biopharmaceutical product candidates are subject to additional risks and uncertainties.

We ~~may~~ acquire ~~more~~ royalties on development-stage product candidates that have not yet received marketing approval by any regulatory authority or been commercialized. There can be no assurance that the FDA, the Medicines and Healthcare products Regulatory Agency (“MHRA”), the ~~European Medicines Agency (“~~EMA”), Pharmaceuticals and Medical Devices Agency (“PMDA”) or other regulatory authorities will approve such products or that such products will be brought to market on a timely basis or at all, the pricing or reimbursement of such products, if approved, or that the market will be receptive to such products. We have previously acquired royalties on development-stage product candidates for which clinical development was stopped for a number of reasons, including clinical trials failing to meet their primary endpoints. These failures have resulted in, and future failures could lead to, non-cash impairment charges or other investment write downs.

If the FDA, MHRA, the EMA, PMDA or other regulatory authority approves a development-stage product candidate that generates our royalties, the labeling, packaging, manufacturing, adverse event reporting, storage, advertising, promotion and recordkeeping for the product will be subject to extensive and ongoing regulatory requirements. The subsequent discovery of previously unknown problems with the product, including adverse events of unanticipated severity or frequency, may result in ~~restrictions on the~~ marketing ofrestrictions ~~the~~or ~~product and could include~~ withdrawal ~~of the product~~ from the market.

In addition, the developers of these development-stage product candidates may not be able to raise additional capital to continue their discovery, development and commercialization activities, which may cause them to delay, reduce the scope of, or eliminate one or more of their clinical trials or R&D programs. If other product developers introduce and market products that are more effective, safer or less expensive than the products that generate our royalties, or if such developers introduce their products prior to the competing products underlying our royalties, the products in which we have invested may not achieve commercial success and thereby result in diminished returns or reduced royalties for us, adversely affecting our business, financial condition or results of operations.

Further, the developers of such products may not have sales, marketing or distribution capabilities. If no sales, marketing or distribution arrangements can be made on acceptable terms or at all, the affected product may not be able to be successfully commercialized, which will result in a loss for us. Losses from such assets could adversely affect our business, financial condition or results of operations.

We intend to continue to provide capital to innovators to co-fund clinical development of a product candidate in exchange for a share of the future revenues of that asset and when we do so, we do not control its clinical development. In these situations, the innovators may not complete activities on schedule or in accordance with our expectations or in compliance with applicable laws and regulations, which could delay or prevent the development, approval, manufacturing or commercialization of the development-stage product candidate for which we have provided funding.

Uncertainty relating to development-stage product candidates makes it more difficult to develop accurate assumptions for our internal models, which ~~can~~may result in reduced royalties compared to our estimates. There can be no assurance that our assumptions around the likelihood of a development-stage product candidate’s approval, expected pricing or achieving ~~significant~~our forecasted sales will prove correct, that regulatory authorities will approve such development-stage product candidates, that such development-stage product candidates will be brought to market on a timely basis or at all, or that such products will achieve commercial success or result in royalties consistent with our estimates.

17We may undertake strategic acquisitions of operating biopharmaceutical companies or acquire securities of biopharmaceutical companies. Our failure to realize the expected benefits of such acquisitions could adversely affect our business, financial condition or results of operations.

We may ~~undertake~~acquire ~~strategic~~companies ~~acquisitions~~with significant royalty assets or where we believe we could create significant synthetic royalties. These acquired or created royalty assets may not perform as we project. Moreover, the acquisition of operating biopharmaceutical companies may expose us to liabilities not inherent in our other royalty acquisitions, such as direct exposure to product liability claims, high fixed costs or ~~acquire~~an ~~securities~~expansion of ~~biopharmaceutical~~our ~~companies~~operations and expense structure, thereby potentially decreasing our profitability. ~~Our~~The ~~failure~~diversion toof ~~realize~~our ~~expected~~management’s ~~benefits~~attention and any delay or difficulties encountered in connection with any future acquisitions could result in the disruption of our on-going business operations. Despite our business, financial and legal due diligence efforts, we have limited experience in assessing opportunities to acquire operating businesses, and we ultimately may be unsuccessful in ascertaining or evaluating all risks associated with such acquisitions. Moreover, we may need to raise additional funds through public or private debt or equity financing to acquire any businesses or products, which may result in dilution for shareholders or the incurrence of indebtedness. As a result, acquisitions of operating biopharmaceutical companies could adversely affect our business, financial condition or results of operations.

We may acquire ~~companies~~securities ~~with~~issued ~~significant~~by ~~royalty~~biopharmaceutical ~~assets~~companies. orWhere ~~where~~ we ~~believe~~acquire weequity ~~could~~securities ~~create~~as ~~significant~~all ~~synthetic royalties. These acquired~~ or ~~created~~part ~~royalty~~of ~~assets~~the ~~may~~consideration ~~not~~for ~~perform~~business asdevelopment ~~we project. Moreover~~activities, the ~~acquisition~~value of ~~operating~~those ~~biopharmaceutical~~securities ~~companies~~ will ~~result~~fluctuate, inand ~~the~~may ~~assumption~~depreciate. ~~of,~~We orwill ~~exposure~~not ~~to,~~control ~~liabilities of~~ the ~~acquired~~companies ~~business that are not inherent~~ in ~~our~~which ~~other~~we ~~royalty~~acquire ~~acquisitions~~securities, ~~such~~and aswe ~~direct~~will ~~exposure~~have tolimited ~~product~~ability ~~liability~~to ~~claims~~determine management, ~~high~~operational ~~fixed~~decisions ~~costs~~ or anpolicies. ~~expansion~~Further, ofsuch ~~our~~transactions ~~operations~~may ~~and~~face ~~expense~~risks ~~structure,~~and ~~thereby~~liabilities ~~potentially~~that ~~decreasing~~due ~~our~~diligence ~~profitability.~~efforts ~~The~~fail ~~diversion~~to ofdiscover, ~~our~~that ~~management’s~~are ~~attention~~not ~~and~~disclosed ~~any~~to ~~delay~~us, or ~~difficulties~~that ~~encountered~~we ininadequately ~~connection~~assess. ~~with~~In ~~any~~addition, ~~future acquisitions~~ we may ~~consummate~~receive ~~could~~material ~~result~~non-public ininformation ~~the~~about ~~disruption~~other ~~of our on-going business operations~~companies. ~~Despite~~Where ~~our~~such ~~business,~~information ~~financial~~relates ~~and~~to ~~legal~~a ~~due~~company ~~diligence~~whose ~~efforts,~~equity securities we ~~have limited experience in assessing opportunities to acquire operating businesses~~hold, ~~and~~ we ~~ultimately~~ may be ~~unsuccessful~~delayed ~~in ascertaining~~ or ~~evaluating~~prevented ~~all~~from ~~risks~~selling ~~associated with~~ such ~~acquisitions.~~securities ~~Moreover,~~when we ~~may~~would ~~need~~otherwise choose to ~~raise~~do ~~additional~~so, ~~funds~~and ~~through~~such ~~public~~delay or ~~private~~prohibition ~~debt or equity financing to acquire any businesses or products, which~~ may result in ~~dilution~~a ~~for~~loss ~~shareholders~~ or ~~the~~reduced ~~incurrence~~gain ofon ~~indebtedness.~~such ~~As a result, our acquisition of operating biopharmaceutical companies could adversely affect our business, financial condition or results of operations~~securities.

We may seek to expand our market opportunity by acquiring securities issued by biopharmaceutical companies. Where we acquire equity securities as all or part of the consideration for business development activities, the value of those securities will fluctuate, and may depreciate. We will not control the companies in which we acquire securities, and as a result, we will have limited ability to determine management, operational decisions or policies. Further, such transactions may face risks and liabilities that due diligence efforts fail to discover, that are not disclosed to us, or that we inadequately assess. In addition, as a result of our activities, we may receive material non-public information about other companies. Where such information relates to a company whose equity securities we hold, we may be delayed or prevented from selling such securities when we would otherwise choose to do so, and such delay or prohibition may result in a loss or reduced gain on such securities. 16

We use leverage in connection with our capital deployment, which magnifies the potential for loss if the royalties ~~acquired~~we acquire do not generate sufficient income ~~to us~~.

We ~~use borrowed funds to~~ finance a significant portion of our capital deployment with borrowed funds. The use of leverage creates an opportunity for an increased return but also increases the risk of loss if our assets do not generate sufficient cash flows ~~to us~~. Our interest expense has increased in recent years. The interest expense and other costs ~~incurred~~associated ~~in connection~~ with ~~such~~our borrowings may not be covered by our cash flow. In addition, leverage may inhibit our operating flexibility and reduce cash ~~flow~~ available for dividends or ~~to make~~ share repurchases.

~~The~~Our level of ~~our~~ indebtedness could limit our ability to respond to changing business conditions. The ~~various~~ agreements ~~relating~~governing to our borrowings may impose operating and financial restrictions ~~on us~~ which could affect the number and size of the royalties that we may pursue. Therefore, no assurance can be given that we will be able to take advantage of favorable conditions or opportunities as a result of any restrictive covenants under our indebtedness. There can also be no assurance that additional debt financing, either to replace or increase existing debt financing, will be available when needed or, ~~if available, will be obtainable~~ on ~~terms that are~~ commercially reasonable terms.

Additional risks related to our leverage include:

• to the extent that interest rates at which we borrow increase, our borrowing costs will increase and our leveraging strategy will become more costly, which could lead to diminished Portfolio Cash Flow and net profits;

• we have to comply with various financial covenants in the agreements that govern our debt, including requirements to maintain certain leverage ratios and coverage ratios, which may affect our ability to achieve our business objectives;

• our ability to pay dividends or make share repurchases may be restricted;

• our royalties may be used as collateral for our borrowings; and

• in the event of a default under secured borrowings, if any, one or more of our creditors or their assignees could obtain control of our royalties and, in the event of a distressed sale, these creditors could dispose of these royalties for significantly less value than we could realize for them.

WeThe dosuccess ~~not~~of ~~employ~~ our ~~own~~business ~~personnel~~depends ~~and~~on ~~are~~key ~~entirely~~members ~~dependent~~of ~~upon~~our ~~the Manager for all the services we require~~team.

~~Because~~We ~~we are “externally managed,” we do not employ our own personnel, but instead~~ depend ~~upon~~on the ~~Manager~~expertise, ~~its~~skill ~~executive officers~~ and ~~its~~network ~~employees~~of ~~for~~business ~~all~~contacts of ~~the~~key ~~services~~members weof ~~require.~~our ~~The~~team, ~~Manager~~who ~~selects~~evaluate, ~~and~~negotiate, ~~manages~~structure, ~~the acquisition of royalties~~execute, ~~milestones~~monitor and ~~other~~service ~~contractual receipts and related assets that meet~~ our ~~investment criteria and provides all our other administrative services~~assets. ~~Accordingly,~~Our ~~our~~future success isdepends ~~dependent~~to ~~upon~~a ~~the~~significant ~~expertise~~extent ~~and~~on ~~services of~~ the ~~executive~~continued ~~officers~~service and ~~employees~~coordination of ~~the~~our ~~Manager~~team. ~~The~~Although ~~Management~~our ~~Agreement~~executives ~~has~~must andevote ~~initial~~substantially ~~term~~all of ~~ten~~their ~~years,~~business ~~after~~time ~~which~~to itmanaging ~~can be renewed for an additional term of three years~~us, unless ~~either~~otherwise weapproved orby the ~~Manager~~board ~~provide notice~~ of ~~non-renewal~~directors, ~~180~~key ~~days~~members ~~prior the expiration~~ of ~~the~~our ~~initial~~team ~~term or renewal term. The Manager~~ may ~~not~~have beother ~~removed~~demands ~~during~~on ~~the~~their ~~initial~~time, orand ~~any~~we ~~renewal~~cannot ~~term~~assure ~~without~~you ~~cause.~~that ~~While~~they ~~our~~will ~~Management~~continue ~~Agreement requires its executives~~ to ~~devote~~be ~~substantially~~actively ~~all~~involved ~~their~~in ~~time~~our tobusiness. ~~managing~~The usdeparture ~~and~~of any ~~legacy~~of ~~vehicles~~these ~~related~~individuals ~~to RPI 2019 ICAV~~ or ~~Old~~competing ~~RPI~~demands ~~unless~~on ~~otherwise~~their ~~approved~~time bycould ~~the~~adversely ~~board~~affect ofour ~~directors~~business, ~~such~~financial ~~resources~~condition ~~may~~or ~~prove~~results toof ~~be inadequate to meet our needs~~operations.

~~The~~Our ~~success~~key ofprofessionals ~~our~~have ~~business~~relationships ~~depends~~with participants in the biopharmaceutical industry, financial institutions and other professionals, which we rely upon to source potential asset acquisition opportunities. If our key ~~members~~professionals offail ~~the~~to ~~Manager’s~~maintain ~~advisory~~such ~~team~~relationships, ~~who~~or to develop new relationships with other sources, we may not ~~continue~~be able to ~~work~~grow ~~for~~our ~~the~~portfolio. ~~Manager~~In addition, we can offer no assurance that these relationships, even if maintained, will generate royalty acquisition opportunities.

We depend on the expertise, skill and network of business contacts of the key members of the Manager’s advisory team, who evaluate, negotiate, structure, execute, monitor and service our assets. Our future success depends to a significant extent on the continued service and coordination of the advisory team of the Manager, particularly Mr. Legorreta. Pursuant to the Management Agreement, executives of the Manager must devote substantially all of their business time to managing us, unless otherwise approved by the board of directors. Despite this, Mr. Legorreta and other key members of the Manager’s advisory team may have other demands on their time, and we cannot assure you that they will continue to be actively involved in our business. Each of these individuals is an employee of the Manager and is not subject to an employment contract with us, which means we do not direct the composition of the Manager’s advisory team as well as the compensation or professional development of these individuals. The departure of any of these individuals or competing demands on their time could adversely affect our business, financial condition or results of operations. 17

~~The~~There ~~key~~can ~~advisory~~be ~~professionals~~no ofassurance ~~the~~that ~~Manager have relationships with participants in~~ the ~~biopharmaceutical~~policies ~~industry, financial institutions~~ and ~~other~~procedures ~~advisory professionals, which~~ we ~~rely~~have ~~upon~~established to ~~source~~mitigate ~~potential~~conflicts ~~asset acquisition opportunities. If the key advisory professionals~~ of ~~the~~interest ~~Manager~~will ~~fail to maintain such relationships, or to develop new relationships with other sources, we may not~~ be ~~able to grow our portfolio~~effective. ~~In addition, we can offer no assurance that these relationships, even if maintained, will generate royalty acquisition opportunities for us in the future.~~

19There could be conflicts of interest between us and our personnel. Every senior executive is subject to a non-compete agreement that is effective for 18 months following termination of their employment for any reason. In addition, executives must devote substantially all of their time to us, unless otherwise approved by the board of directors. Despite this, the ability of our officers and employees to engage in other business activities may reduce the amount of time they spend working for us. For instance, Mr. Legorreta, our Chief Executive Officer, is also a co-founder of and has significant influence over Pharmakon Advisors, which manages BioPharma Credit PLC (LSE: BPCR) and other investment vehicles that collectively are leading providers of debt capital to the biopharmaceutical industry and he has a substantial investment in BioPharma Credit. In addition, Mr. Legorreta serves as the chairperson of ProKidney Corp.’s board of directors and he participates in foundations that receive and provide medical research funding. Even though he is involved with the companies and the foundations described above, among other organizations, Mr. Legorreta does not have any material constraints on the time he has available to devote to us. While Pharmakon may pursue similar investment opportunities, we believe that actual conflicts of interest are rare due to differing investment strategies, and the fact that royalty holders determine the type of transaction they seek. Under arrangements with Pharmakon, we may provide research, business development, legal, compliance, financial and administrative services to one another, and each party reimburses the other to the extent it provides materially more services than it receives.

~~There~~To ~~can~~service beour noindebtedness ~~assurance~~and ~~that~~meet ~~the~~our ~~policies~~other ~~and~~liquidity ~~procedures~~needs, we ~~have~~require ~~established~~a significant amount of cash. Our ability to ~~mitigate~~generate ~~conflicts~~cash ofdepends ~~interest~~on ~~will~~many factors beyond our control. If we cannot generate the required cash, we may be ~~effective~~unable into ~~doing~~make ~~so.~~the required payments under our indebtedness.

~~The~~As ~~Manager~~of ~~cannot~~December ~~manage~~31, ~~another~~2025, ~~entity~~our ~~that~~total ~~invests~~principal inamount orof ~~acquires~~our ~~royalties~~senior ~~other~~unsecured ~~than~~notes ~~any~~and ~~legacy~~borrowings ~~vehicle~~under ~~related~~our toterm ~~RPI~~loan ~~2019~~was ~~ICAV~~$9.2 ~~or Old RPI~~billion. ~~Every~~In ~~senior~~addition ~~executive~~to ofthis ~~the~~indebtedness, ~~Manager~~we ishave ~~subject~~up to a$1.8 billion ~~non-compete~~of ~~agreement~~available ~~that~~revolving iscommitments ~~effective~~under ~~for~~our 18Revolving ~~months~~Credit ~~following~~Facility ~~termination~~(as ofdefined ~~their~~below). ~~employment~~Furthermore, ~~for~~on ~~any~~August ~~reason.~~4, We2025, ~~are~~we aentered ~~beneficiary~~into ofan ~~these~~uncommitted ~~agreements.~~credit ~~In addition~~facility, ~~executives~~which provides for borrowing capacity of ~~the~~up ~~Manager~~to ~~must~~$350 ~~devote~~million ~~substantially~~at ~~all~~the discretion of ~~their~~the ~~time~~lender tothereunder. ~~managing~~Except usfor RP Holdings and ~~any~~RP ~~legacy~~Manager, ~~vehicle~~our ~~related~~subsidiaries tothat ~~RPI~~do ~~2019~~not ~~ICAV~~guarantee orour ~~Old~~indebtedness ~~RPI~~will have no obligation, ~~unless~~contingent or otherwise, ~~approved~~to bypay ~~the~~amounts ~~board~~due ofunder ~~directors.~~our ~~Despite~~indebtedness ~~this,~~or ~~the~~to ~~ability~~make ofany ~~the~~funds ~~Manager~~available ~~and~~to ~~its~~pay ~~officers~~those ~~and~~amounts, ~~employees~~whether toby ~~engage~~dividend, indistribution, ~~other~~loan ~~business~~or ~~activities,~~other ~~subject~~payment. toWe ~~the~~cannot ~~terms~~assure ofyou that our ~~Management~~business ~~Agreement,~~will ~~may~~generate ~~reduce~~sufficient ~~the~~cash ~~amount~~flow offrom ~~time~~operations ~~the~~to ~~Manager,~~enable ~~its~~us ~~officers~~to pay our indebtedness or ~~other~~to ~~employees~~fund ~~spend~~our ~~managing~~other usliquidity needs.

~~There~~Absent ~~could~~sufficient becash ~~conflicts~~flow ~~of interest between us~~ and ~~our advisory personnel. For instance, Mr. Legorreta, our Chief Executive Officer, is also a co-founder of and has significant influence over Pharmakon Advisors, which shares physical premises with~~ the ~~Manager.~~ability ~~Pharmakon manages BioPharma Credit PLC (LSE: BPCR) and other investment vehicles that collectively are leading providers of debt capital~~ to ~~the biopharmaceutical industry. Mr. Legorreta has a substantial investment in BioPharma Credit. In addition~~refinance, ~~Mr.~~we ~~Legorreta~~may ~~serves~~be asforced ~~the~~to ~~chairperson~~sell ofassets ~~the~~to ~~board~~make ofup ~~directors~~for ofany ~~ProKidney~~shortfall ~~Corp. and he has founded and participates~~ in ~~foundations~~our ~~that~~payment ~~receive and provide medical research funding~~obligations. ~~Even though he is involved with Pharmakon~~However, ~~BioPharma Credit PLC, ProKidney Corp. and~~ the ~~foundations~~agreements ~~described~~governing ~~above,~~our ~~among~~outstanding ~~other~~indebtedness ~~organizations,~~limit ~~Mr.~~our ~~Legorreta~~and ~~does~~our ~~not~~subsidiaries’ ~~have~~ability ~~any material constraints on the time he has available~~ to ~~devote~~sell toassets ~~the Manager~~ and ~~thereby~~also torestrict ~~us. While~~ the ~~Manager~~use ~~and Pharmakon may pursue similar investment opportunities, we believe that actual conflicts~~ of ~~interest~~proceeds ~~are~~from ~~rare~~such ~~due~~a ~~to differing investment strategies, and the fact that royalty holders determine the type of transaction they seek~~sale. ~~Under arrangements with Pharmakon~~Accordingly, ~~the~~we ~~Manager subleases office space to Pharmakon, and the parties~~ may ~~provide~~be ~~research,~~unable ~~business development, legal, compliance, financial and administrative services~~ to ~~one~~sell ~~another.~~assets ~~The~~quickly ~~Manager~~enough ~~and~~or ~~Pharmakon~~for ~~reimburse~~sufficient ~~each~~amounts ~~other~~ to ~~the~~meet ~~extent~~our ~~that~~obligations ~~one~~on ofour ~~them provides materially more services to the other than they receive in return~~indebtedness. ~~In addition, certain employees of the Manager may receive compensation from Pharmakon.~~

The Manager’s compensation arrangements may have unintended consequences. We have agreed to pay the Manager or its affiliates quarterly operating and personnel expenses (the “Operating and Personnel Payments”), based on Portfolio Receipts and the mark-to-market value of security investments at the end of each quarter regardless of whether we realize any gain on our investments. Consequently, the Manager may be incentivized to have us make investments regardless of our expected gain on such investments, which may not align with our or our shareholders’ interests.

To service our indebtedness and meet our other ongoing liquidity needs, we will require a significant amount of cash. Our ability to generate cash depends on many factors beyond our control. If we cannot generate the required cash, we may not be able to make the required payments under our indebtedness.

As of December 31, 2024, our total principal amount of senior unsecured notes outstanding was $7.8 billion. In addition, we have up to $1.8 billion of available revolving commitments under our Revolving Credit Facility (as defined below). Except for RP Holdings, our subsidiaries that do not guarantee the senior unsecured notes will have no obligation, contingent or otherwise, to pay amounts due under the senior unsecured notes or to make any funds available to pay those amounts, whether by dividend, distribution, loan or other payment. We cannot assure you that our business will generate sufficient cash flow from operations to enable us to pay our indebtedness or to fund our other liquidity needs.

Absent sufficient cash flow and the ability to refinance, we could also be forced to sell assets to make up for any shortfall in our payment obligations. However, the terms of the agreements that govern our existing outstanding debt limit our and our subsidiaries’ ability to sell assets and also restrict the use of proceeds from such a sale. Accordingly, we may not be able to sell assets quickly enough or for sufficient amounts to enable us to meet our obligations on our indebtedness.

Our business is subject to interest rate, foreign exchange, inflation and banking industry risk.

We are subject to interest rate ~~fluctuation~~fluctuations ~~exposure~~ through any borrowings under our Revolving Credit Facility, Term Loan and ~~our~~through investments in money market accounts and marketable securities, the majority of which bear a variable interest ~~rate~~rates. ToIf ~~the extent that~~ interest rates ~~generally~~were to increase, our borrowing costs may increase and our leverage strategy ~~will~~may become more costly, ~~leading~~which tocould ~~diminished~~reduce Portfolio Cash Flow and net profits. If interest rates were to decrease, returns on our investments in money market accounts and marketable securities may decrease.

20Certain products pay royalties in currencies other than U.S. dollars, which creates foreign currency risk primarily with respect to the Euro, Canadian dollar, British pound, Swiss franc and Japanese yen, as our functional and reporting currency is the U.S. dollar. In addition, our results of operations are subject to foreign currency exchange risk through transactional exposure resulting from movements in exchange rates between the time we recognize income on financial royalty assets and the time at which the transaction settles, or we receive the royalty payment. Because we are entitled to royalties on worldwide sales for various products, there is an underlying exposure to foreign currency as the marketer converts payment amounts from local currencies to U.S. dollars using a quarterly average exchange rate. Therefore, cash received may differ from the estimated amount we expected to receive based on fluctuations in currency.

Certain products pay royalties in currencies other than U.S. dollars, which creates foreign currency risk primarily with respect to the Euro, Canadian dollar, British pound, Swiss franc and Japanese yen, as our functional and reporting currency is the U.S. dollar. In addition, our results of operations are subject to foreign currency exchange risk through transactional exposure resulting from movements in exchange rates between the time we recognize royalty income or royalty revenue and the time at which the transaction settles, or we receive the royalty payment. Because we are entitled to royalties on worldwide sales for various products, there is an underlying exposure to foreign currency as the marketer converts payment amounts from local currencies to U.S. dollars using a quarterly average exchange rate. Therefore, cash received may differ from the estimated receivable based on fluctuations in currency. 18

We are also subject to risks and uncertainties caused by significant events with macroeconomic impacts, including, but not limited to geopolitical events, including the Russia-Ukraine conflict, conflicts in the Middle East, tensions between China and Taiwan, trade and other international disputes, including new or increased tariffs and other barriers to trade, rising inflation and interest rates, monetary policy changes, financial services sector instability, recessions, global pandemics, significant natural disasters and foreign currency fluctuations. Changes in the value of currencies relative to the U.S. dollar, or high inflation in countries using a currency other than the U.S. dollar, can impact our revenues, costs and expenses and our financial guidance.

Other events that affect the banking industry may adversely affect the banking institutions that hold our cash. Our primary operating accounts significantly exceed the Federal Deposit Insurance Corporation limits. In the event of a bank insolvency or failure, we may be considered a general creditor of the bank, and we might lose some or all of the cash deposited with the bank. Even where it is recognized that a bank might be in danger of insolvency or failure, we might not be able to withdraw or transfer our cash from the bank in time to avoid any adverse effects of the insolvency or failure.

Information available to us about the biopharmaceutical products underlying the royalties we buy may be limited and therefore our ability to analyze each product and its potential future cash flow may be similarly limited.

We may have limited information concerning the products generating the royalties we are evaluating for acquisition. Often, the information we have regarding products following our acquisition of a royalty may be limited to the information that is available in the public domain. Therefore, there may be material information that relates to such products that we would like to know but do not have and may not be able to obtain. For example, we domay not ~~always~~have ~~know~~access to the results of studies conducted by marketers of the products or others or the nature or amount of any complaints from doctors or users of such products. In addition, the market data that we obtain independently may also prove to be incomplete or incorrect. Due to these and other factors, the actual cash flow from a royalty may be significantly lower than the amounts we estimate, which could negatively impact our ~~estimates~~internal rates of return, return on invested capital and return on invested equity.

Our future income is dependent upon numerous royalty-specific assumptions and, if these assumptions prove not to be accurate, we may not achieve our expected rates of returns.

Our business model is based on multiple-year internal and external forecasts regarding product sales and numerous product-specific assumptions in connection with each royalty acquisition, including where we have limited information regarding the product. There can be no assurance that the assumptions underlying our financial models, including those regarding product ~~sales~~pricing, reimbursement rates or sales, competition, patent expirations, exclusivity terms, license terms or license terminations for the products underlying our portfolio, are accurate. These assumptions involve a significant element of subjective judgment and may be, and in the past have been, adversely affected by post-acquisition changes in market conditions and other factors affecting the underlying product. The risks relating to these assumptions ~~may~~are be exacerbated for development-stage product candidates due to the uncertainties around their development, labeling, regulatory approval, commercialization timing, anticipated pricing, manufacturing and supply, competing products or related factors. Our assumptions regarding the financial stability or operational or marketing capabilities of the partner obligated to pay us royalties may also prove, and in the past have proven, to be incorrect. Due to these and other factors, the assets in our current portfolio or future assets may not generate expected returns or returns in line with our historical financial performance or in the time periods we expect or at all, which could adversely affect our business, financial condition or results of operation.

We make assumptions regarding the royalty duration for terms that are not contractually fixed, and a shortened royalty term could result in a reduction in the effective interest rate, a decline in income from royalties, significant reductions in royalty payments compared to expectations, or a permanent impairment.

In accordance with generally accepted accounting principles in the United States (“GAAP”), we classify most royalty assets that we acquire as financial assets that are measured at amortized cost using the prospective effective interest method described in ASC 835-30. The effective interest rate is calculated by forecasting the expected cash flows to be received over the life of the asset relative to the initial invested amount, net of any purchased receivables. A critical component of such forecast is our assumptions regarding duration of the royalty.

The royalty duration is important for purposes of accurately measuring interest income over the life of a royalty. In making assumptions around the royalty duration for terms that are not contractually fixed, we consider the strength of existing patent protection, expected entry of generics, geographical exclusivity periods and potential patent term extensions tied to the underlying product.

The duration of a royalty usually varies on a country-by-country basis and can be based on a number of factors, such as patent expiration dates, whether the product is sold singly or in combination, regulatory exclusivity, years from first commercial sale of the patent-protected product, the entry of competing generic or biosimilar products, or other terms set out in the contracts governing the royalty. It is common for royalty durations to expire earlier or later than anticipated due to unforeseen positive or negative developments over time, including with respect to the granting of patents and patent term extensions, the invalidation of patents, claims of patent misuse, litigation between the party controlling the patents and third party challengers of the patents, the ability of third parties to design around or circumvent valid patents, the granting of regulatory exclusivity periods or extensions, timing for the arrival of generic or biosimilar competitor products, changes to legal or regulatory regimes affecting intellectual property rights or the regulation of pharmaceutical products, product life cycles, and industry consolidations.

If an unexpected shortening of a royalty term were to occur, it could result in a reduction in the effective interest rate for the asset, a decline in income from royalties, a significant reduction in royalty receipts compared to expectations, or a permanent impairment.

Most of our royalties are classified as financial assets that are measured at amortized cost using the effective interest method as a result of which our GAAP results of operations can be volatile and unpredictable.

In accordance with GAAP, most of the royalty assets we acquire are treated as investments in cash flow streams and are thus classified as financial assets. Under this classification, our financial royalty assets are treated as having a yield component that resembles loans measured at amortized cost under the effective interest accounting methodology. Under this accounting methodology, we calculate the effective interest rate on each financial royalty asset using a forecast of the expected cash flows to be received over the life of the financial royalty asset relative to the initial acquisition price. The yield, which is calculated at the end of each reporting period and applied prospectively, is then recognized via accretion into our income at the effective rate of return over the expected life of the financial royalty asset.

As a result of the non-cash charges associated with the application of the effective interest method accounting methodology, our income statement activity in respect of many of our royalties can be volatile and unpredictable. Small declines in sell-side equity research analysts’ consensus sales forecasts over a long time horizon can result in an immediate non-cash income statement expense recognition, even though the applicable cash inflows will not be realized for many years into the future. For example, in late 2014 we acquired our royalty on the cystic fibrosis franchise, which is classified as a financial royalty asset. Beginning in the second quarter of 2015, declines in near-term sales forecasts of sell-side equity research analysts caused us to recognize non-cash provision expense and build up a corresponding cumulative allowance which reduced the gross balance for this financial royalty asset. Over the course of the next 10 quarters, we recognized non-cash provision expense as a result of these changes in forecasts, including a non-cash expense of $743.2 million in 2016, ultimately reaching a peak cumulative allowance of $1.30 billion by September 30, 2017 related to this financial royalty asset. With the approval of the Vertex triple combination therapy, Trikafta, in October 2019, sell-side equity research analysts’ consensus sales forecasts increased to reflect the larger addressable market and the extension of the expected duration of the Trikafta royalty. While small reductions in the cumulative allowance for the cystic fibrosis franchise were recognized as provision income in 2017 and 2018, there remained a $1.10 billion cumulative allowance that was fully reduced by recognizing non-cash provision income of $1.10 billion in 2019 as a result of an increase in sell-side equity research analysts’ consensus sales forecasts associated with the Trikafta approval. Despite the growth in royalty receipts following the approval of Trikafta, the financial statement impact caused by the application of the effective interest accounting methodology could result in a negative perception of our results in a given period. In addition, because of the conservative assumption that royalties will only be collected on the tezacaftor component of Vertex’s Alyftrek and not on the deuterated ivacaftor component, if deuterated ivacaftor is determined to be royalty-bearing, the impact to our 2024 results of operations would be recognition of provision income of approximately $259.4 million.

Our reliance on a limited number of products may adversely affect our business, financial condition and results of operation.

~~While~~Although our current asset portfolio includes royalties relating to over 35 marketed products, the top five product franchises accounted for 6461% of our Royalty Receipts in the year ended December 31, ~~2024~~2025. In addition, our asset portfolio may not be fully diversified by geographic region or other ~~criteria~~factors. Any significant deterioration in the cash flows from the top products in our asset portfolio could negatively impact our internal rates of return, return on invested capital and return on invested equity, which could, in turn, adversely affect our business, financial condition or results of operations.

We face competition in acquiring royalties and locating suitable royalties to acquire.

There are a limited number of suitable and attractive opportunities to acquire high-quality royalties. ~~Therefore,~~Competition ~~competition~~ to acquire such royalties is ~~intense~~significant and may increase. We compete with ~~other~~a ~~potential~~broad ~~acquirers~~range ~~for~~of ~~these~~potential ~~opportunities~~acquirers, including biopharmaceutical companies that market the products on which royalties are paid, investment vehicles and other pools of capital, financial institutions, institutional investors, (including sovereign wealth and pension funds), and ~~others~~other market participants. These competitors may be able to access lower cost capital, may be larger than us, may have relationships that provide them access to opportunities before us, or may be willing to acquire royalties for lower projected returns than we are.

Biopharmaceutical products are subject to substantial competition.

The biopharmaceutical industry is a highly competitive and rapidly evolving industry. The length of any product’s commercial life cannot be predicted with certainty. One or more products on which we are entitled to a royalty may be rendered obsolete or non-competitive by new or alternate products or improvements made to existing products on which we are not entitled to a royalty, either by the current marketer of such products or by another marketer. Current marketers of products may undertake these development efforts in order to improve their products or to avoid paying our royalty. ~~Adverse competition~~Competition, obsolescence or governmental and regulatory action or healthcare policy changes could significantly affect the revenues, including royalty-related revenues, of the products which generate our royalties.

Competitive factors affecting the market position and success of each product include:

•safety, side effect profile, effectiveness and market acceptance;

•price, including third-party insurance reimbursement policies;

•timing, introduction and marketer support of the product;

•efficacy and execution of marketing and commercialization strategy;

•market acceptance;

•manufacturing, supply and distribution;

•governmental regulation and policy, including price caps;

•availability of lower-cost generics or biosimilars or alternative treatments;

•intellectual property protection and exclusivity;

•treatment innovations that eliminate or minimize the need for a product; and

•product liability claims.

Products on which we have a royalty receivable or other interest may be rendered obsolete or non-competitive by new or alternate products, including generics or biosimilars, improvements on existing products, marketing or commercialization strategies, or governmental or regulatory action. In addition, as biopharmaceutical companies increasingly devote significant resources to innovate next-generation products and therapies, products on which we have a royalty may become unattractive to commercialize or obsolete. If a product’s market acceptance is diminished or it is withdrawn from the market, continuing payments with respect to biopharmaceutical products will decrease or potentially cease, which may affect our ability to realize the benefits of the royalty receivable or other interest in such product and may result in us incurring asset impairment charges. Further, any product for which we have a royalty receivable or other interest that competes with an approved product must demonstrate compelling advantages in efficacy, convenience, tolerability and safety in order to overcome price competition and to be commercially successful. Many approved drugs are well established therapies and are widely accepted by physicians, patients and third-party payors. Insurers and other third-party payors may also encourage the use of generic or alternate products. Any of these developments could adversely affect products on which we have a royalty, and consequently could adversely affect our business, financial condition or results of operations.

Marketers of products that generate our royalties are outside of our control.

In the case of our royalty receivables, our cash flow consists primarily of payments supported by royalties paid by marketers. These marketers may have interests that are different from our interests. For example, these marketers may be motivated to maximize their overall income by allocating resources to other products and, in the future, may decide to focus less attention on the products generating our royalties or by allocating resources to develop products that do not generate royalties to us. There can be no assurance that any marketer or person with whom the marketer has a working relationship has adequate resources or motivation to continue to produce, market and sell the products generating our royalties. Aside from any limited audit rights relating to the activities of the marketers that we may have in certain circumstances pursuant to the terms of our arrangements with the licensor, we do not have oversight rights with respect to the marketers’ operations and do not have rights allowing us to direct their operations or strategy nor do our agreements contain performance standards for their operations. The calculation of the royalty payments is subject to and dependent upon the adequacy and accuracy of our counterparties’ sales and accounting functions.

While we may be able to receive certain information relating to sales of products through the exercise of audit rights and review of royalty reports we receive from the licensor, such information may be received many months following our recognition of the royalty revenue, may require us to adjust our royalty revenues in later periods and may require expense on our part.

We have limited information on the marketers’ operations. We will not have the right to review or receive certain information relating to products that the marketers may have, including the results of any studies conducted by the marketers or others, or complaints from doctors or users of products. The market performance of the products generating our royalties may therefore be diminished by any number of factors relating to the marketers that are outside of our control.

The marketers of biopharmaceutical products are, generally, entirely responsible for the ongoing regulatory approval, commercialization, manufacturing and marketing of products.

Generally, the holders of royalties on products have granted exclusive regulatory approval, commercialization, manufacturing and marketing rights to the marketers of such products. The marketers generally have full control over those efforts and sole discretion to determine the extent and priority of the resources they will commit to their program for a product. Accordingly, the successful commercialization of a product depends on the marketer’s efforts and is beyond our control. If a marketer does not devote adequate resources to the ongoing development, regulatory approval, commercialization and manufacture of a product, or if a marketer engages in illegal or otherwise unauthorized practices, the product’s sales may not generate sufficient royalties, or the product’s sales may be suspended, and consequently, could adversely affect our business. In addition, if marketers of biopharmaceutical products decide to discontinue product programs or we believe the commercial prospects of assets have been reduced, we may recognize material non-cash impairment charges related to the financial royalty asset associated with those programs or assets.

License agreements relating to products may, in some instances, be unilaterally terminated or disputes may arise which may affect our royalties.

License agreements relating to the products generating our royalties may be terminated, which may adversely affect sales of such products and therefore the payments we receive. For example, under certain license agreements, marketers retain the right to unilaterally terminate the agreements with the licensors. When the last patent covering a product expires or is otherwise invalidated in a country, a marketer may be economically motivated to terminate its license agreement, either in whole or with respect to such country, in order to terminate its payment and other obligations. In the event of any such termination, a licensor may no longer receive all of the payments it expected to receive from the licensee and may also be unable to find another company to continue developing and commercializing the product on the same or similar terms as those under the license agreement that has been terminated.

In addition, license agreements may fail to provide significant protection for the licensor in case of the licensee’s failure to perform or in the event of disputes. License agreements which relate to the products underlying our royalties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what the licensor believes to be the scope of its rights to the relevant intellectual property or technology, or decrease the licensee’s financial or other obligations under the relevant agreement, any of which could in turn impact the value of our royalties and adversely affect our business, financial condition or results of operations. If a marketer were to default on its obligations under a license agreement, the licensor’s remedy may be limited either to terminating certain licenses related to certain countries or to generally terminate the license agreement with respect to such country. In such cases, we may not have the right to seek to enforce the rights of the licensor and we may be required to rely on the resources and willingness of the licensor to enforce its rights against the licensee.

In any of these situations, if the expected payments under the license agreements do not materialize, this could result in a significant loss to us and adversely affect our business, financial condition or results of operations.

The insolvency of a marketer could adversely affect our receipt of cash flows on the related royalties that we hold.

If a marketer were to become insolvent and seek to reorganize under Chapter 11 of Title 11 of the U.S. Code, as amended, or the Bankruptcy Code, or liquidate under Chapter 7 of the Bankruptcy Code (or foreign equivalent), such event could delay or impede the payment of the amounts due under a license agreement, pending a resolution of the insolvency proceeding. Any unpaid royalty payments due for the period prior to the filing of the bankruptcy proceeding would be unsecured claims against the marketer, which might not be paid in full or at all. While royalty payments due for periods after the filing may qualify as administrative expenses entitled to a higher priority, the actual payment of such post-filing royalty payments could be delayed for a substantial period of time and might not be in the full amount due under the license agreement. The licensor would be prevented by the automatic stay in the bankruptcy proceeding from taking any action to enforce its rights without the permission of the bankruptcy court. In addition, the marketer could elect to reject the license agreement, which would require the licensor to undertake a new effort to market the applicable product with another distributor. Such proceedings could adversely affect the ability of a payor to make payments with respect to a royalty, and could consequently adversely affect our business, financial condition or results of operations.

Unsuccessful attempts to acquire new royalties could result in significant costs, ~~and~~divert ~~negatively~~management ~~impact~~attention ~~subsequent~~and ~~attempts~~adversely toaffect ~~locate~~our ~~and~~ability ~~acquire~~to pursue other ~~assets~~investment opportunities.

The ~~investigation~~evaluation of each ~~specific~~potential ~~target~~ royalty acquisition and the negotiation, drafting and execution of relevant agreements requires substantial management time and attention and results in substantial costs for accountants, attorneys, consultants and other advisors. If a decision is made not to complete a specific acquisition, the costs incurred for the proposed transaction would not be recoverable from a third party. Furthermore, even if an agreement is reached relating to a specific target asset, we may fail to consummate the acquisition for any number of reasons, including, in the case of an acquisition of a royalty through a business combination with a public company, approval by the target company’s public shareholders. Unsuccessful attempts to acquire new royalties could ~~hurt our reputation,~~ result in significant costs, ~~and an~~ inefficient use of management’s time and potential reputational harm. The ~~opportunity~~diversion ~~cost~~ of ~~diverting~~ management attention and financial resources could ~~negatively~~adversely ~~impact~~affect our ability to ~~locate~~evaluate ~~and~~or ~~acquire~~complete other ~~assets~~investments.

The products that generate our royalties are subject to uncertainty related to healthcare reimbursement policies, managed care considerations, pricing pressures and the regulation of the healthcare industry.

In both U.S. and non-U.S. markets, sales of biopharmaceutical products, and the success of such products, depends in part on governmental regulation and the availability and extent of coverage and reimbursement from third-party payors, including government healthcare programs in addition to private insurance plans.

25In the United States, pharmaceutical pricing is subject to increasing government regulation, public scrutiny and policy initiatives. For example, initiatives toward “most favored nation” (MFN) drug pricing in the United States could lead to decreased drug pricing or the drug pricing provisions of the Inflation Reduction Act (“IRA”) which require manufacturers of select drugs to engage in a process to establish negotiated Medicare prices. It is unknown what form any future changes or any law would take under the Trump administration. In addition, the U.S. Patient Protection and Affordable Care Act, as amended (the “ACA”) established a major expansion of healthcare coverage, financed in part by several new rebates, discounts and taxes that had a significant effect on the expenses and profitability on the companies that manufacture the products that generate our royalties.

In the United States, pharmaceutical product pricing is subject to enhanced government regulation, public scrutiny and calls for reforms. For example, the drug pricing provisions of the Inflation Reduction Act (“IRA”) requires manufacturers of select drugs to engage in a process with the U.S. Federal government to set new Medicare prices (which becomes effective in January 2026 for 10 prescription drugs). It is unknown what form any future changes or any law would take under the Trump administration. In addition, the U.S. Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (the “ACA”) established a major expansion of healthcare coverage, financed in part by several new rebates, discounts and taxes that had a significant effect on the expenses and profitability on the companies that manufacture the products that generate our royalties. 23

Other U.S. federal or state legislative or regulatory action or policy efforts could adversely affect the healthcare industry, including, among others, additional transparency and limitations related to product pricing, review the relationship between pricing and manufacturer patient programs, general budget control actions, changes in patent laws, changing interpretations of competition law, exercise by the government of march-in rights in respect of government funded innovations, the importation of prescription drugs from outside the United States at prices that are regulated by governments of various foreign countries, revisions to reimbursement of biopharmaceutical products under government programs, restrictions on U.S. direct-to-consumer advertising or limitations on interactions with healthcare professionals. No assurances can be provided that these laws and regulations will not adversely affect our business, financial condition or results of operations.

Continued intense public scrutiny of the price of drugs, together with government and payor dynamics, may limit the ability of producers and marketers to set or adjust the price of products based on their value. There can be no assurance that new or proposed products will be considered cost-effective or that adequate third-party reimbursement will be available to enable the producer or marketer of such product to maintain price levels sufficient to realize an appropriate return. These pricing pressures may adversely affect our current royalties and the attractiveness of future acquisitions of royalties.

Outside the United States, numerous major markets, including the EU, UK, Japan and China, have pervasive government regulation of healthcare and government involvement in funding healthcare, and, in that regard, fix the pricing and reimbursement of pharmaceutical products. Consequently, in those markets, the products generating our royalties are subject to government decision-making and budgetary actions.

In addition, many of the products in our portfolio benefit from regulatory exclusivity. If, in an effort to regulate pricing, regulatory exclusivity is not maintained, our business, financial condition or results of operations may be adversely impacted.

The biopharmaceutical industry may be negatively affected by federal government deficit reduction policies, which could reduce the value of the royalties that we hold.

In an effort to contain the U.S. federal deficit, the biopharmaceutical industry could be considered a potential source of savings via legislative proposals. Government action to reduce U.S. federal spending on entitlement programs, including Medicare, Medicaid or other publicly funded or subsidized health programs, or to lower drug spending, may affect payment for the products that generate our royalties. These and any other cost controls or any significant additional taxes or fees that may be imposed on the biopharmaceutical industry as part of deficit reduction efforts could reduce cash flows from our royalties and therefore adversely affect our business, financial condition or results of operations.

Sales of products that generate our royalties are subject to regulatory approvals and actions in the United States and foreign jurisdictions that could harm our business.

The procedures to approve biopharmaceutical products for commercialization vary among countries and can involve additional testing and time. Such procedures may include on-site inspections by regulatory authorities at clinical trial sites or manufacturing facilities, which inspections may be delayed ~~by travel restrictions imposed in response to pandemics or other infectious diseases~~. Approval by the FDA does not ensure approval by regulatory authorities in other countries, and approval by one foreign regulatory authority does not ensure approval by regulatory authorities in other foreign countries or by the FDA. The foreign regulatory approval process may include all of the risks associated with obtaining FDA approval and many include additional risks, such as pricing approval.

There can be no assurance that any of these regulatory approvals will be granted or not be revoked or restricted in a manner that would adversely affect the sales of such products and on the ability of payors to make payments with respect to such royalties to us.

The manufacture and distribution of a biopharmaceutical product may be interrupted by regulatory agencies or supplier deficiencies.

The manufacture of products generating our royalties is typically complex and is highly regulated. In particular, biopharmaceutical products are manufactured in specialized facilities that require the approval of, and ongoing regulation by, the FDA in the United States and, if manufactured outside of the United States, both the FDA and non-U.S. regulatory agencies, such as the MHRA and the EMA. With respect to a product, to the extent that operational standards set by such agencies are not adhered to, manufacturing facilities may be closed or production interrupted until such time as any deficiencies noted by such agencies are remedied. Any such closure or interruption may interrupt, for an indefinite period of time, the manufacture and distribution of a product and therefore the cash flows from the related biopharmaceutical asset may be significantly less than expected.

In addition, manufacturers of a product may rely on third parties for selected aspects of product development, such as packaging or to supply bulk raw material used in the manufacture of such product. In the United States, the FDA requires that all suppliers of pharmaceutical bulk materials and all manufacturers of pharmaceuticals for sale in or from the United States adhere to the FDA’s current “Good Manufacturing Practice” regulations and guidelines and similar requirements that exist in jurisdictions outside the United States. Marketers of biopharmaceutical products generally rely on a small number of key, highly specialized suppliers, manufacturers and packagers. Any interruptions, however minimal, in the operation of these manufacturing and packaging facilities could adversely affect production and product sales and therefore adversely affect our business, financial condition or results of operations.

Product liability claims may diminish the returns on biopharmaceutical products.

The developer, manufacturer or marketer of a product could become subject to product liability claims. A product liability claim, regardless of its merits, could adversely affect the sales of the product and the amount of any related royalty payments and could even adversely affect the ability of a payor to make payments with respect to a royalty.

Although we believe that we will not bear responsibility in the event of a product liability claim against the developer, manufacturer, marketer or other seller of a product that generates our royalty, any such product liability claims against us could adversely affect our business, financial condition or results of operations.

We are typically not involved in maintaining, enforcing and defending patent rights on products that generate our royalties.

Our right to receive royalties generally depends on the existence of valid and enforceable claims of registered or issued patents in the United States and elsewhere in the world. The products on which we receive payments are dependent on patent protection and on the fact that the manufacturing, marketing and selling of such products do not infringe, misappropriate or otherwise violate intellectual property rights of third parties. Typically, we have no ability to control the prosecution, maintenance, enforcement or defense of patent rights, but must rely on the willingness and ability of our partners or their marketers to do so. There can be no assurance that these third parties will vigorously prosecute, maintain, enforce or defend such rights. Even if such third parties seek to prosecute, maintain, enforce or defend such rights, they may not be successful.

The patent position of biotechnology and pharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has been the subject of much litigation. Furthermore, changes in patent laws or interpretation of patent laws in the United States and in other jurisdictions could increase the uncertainties surrounding the successful prosecution of patent applications and the successful enforcement or defense of issued patents by our partners, all of which could diminish the value of patent protection relating to the biopharmaceutical assets. As a result, the issuance, scope, validity, enforceability and commercial value of the patent rights of our partners and their marketers are highly uncertain. In addition, such third parties’ pending and future patent applications may not result in patents being issued which protect their products, development-stage product candidates and technologies or which effectively prevent others from commercializing competitive products, development-stage product candidates and technologies. Moreover, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted after issuance.

Even if the patent applications our partners and their marketers license or own do issue as patents, they may not issue in a form that will provide them with any meaningful protection, prevent competitors or other third parties from competing with them or otherwise provide them with any competitive advantage. Competitors or other third parties may be able to circumvent patents of our partners and their marketers by developing similar or alternative products in a non-infringing manner. The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and may be challenged in the courts or patent offices in the United States and abroad. Such challenges may result in loss of exclusivity or in patent claims being narrowed, invalidated or held unenforceable, which could limit the ability of our partners and their marketers from preventing others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of their products, development-stage product candidates and technologies.

Any loss or reduction in the scope or duration of patent protection for any product that generates our royalties, or any failure to successfully prosecute, maintain, enforce or defend any patents that protect any such product may result in a decrease in the sales of such product and any associated royalties payable to us. Any such event would adversely affect the ability of the payor to make payments of royalties to us or may otherwise reduce the value of our royalties, and could consequently adversely affect our business, financial condition or results of operations. In cases where our contractual arrangements with our partner permit us to do so, we could participate in patent suits brought by third parties but this could result in substantial litigation costs, divert management’s attention from our core business and there can be no assurance that such suits would be successful.

The existence of third-party patents in relation to products may result in additional costs for the marketer and reduce the amount of royalties paid to us.

The commercial success of a product depends, in part, on avoiding infringement, misappropriation or other violations of the intellectual property rights and proprietary technologies of others. Third-party issued patents or patent applications claiming subject matter necessary or useful to manufacture and market a product could exist or issue in the future. Such third-party patents or patent applications may include claims directed to the composition, manufacturing, mechanism of action, dosing or other unique features of a product. There can be no assurance that a license would be available to marketers for such subject matter if such infringement were to exist or, if offered, would be offered on reasonable or commercially feasible terms. Without such a license, it may be possible for third parties to assert infringement or other intellectual property claims against the marketer of such product based on such patents or other intellectual property rights.

Even if the marketer was able to obtain a license to the intellectual property rights and proprietary technologies of others, it could be non-exclusive, thereby giving its competitors and other third parties access to the same technologies. In addition, if a marketer of a product that generates our royalties is required to obtain a license from a third party, the marketer may, in some instances, have the right to offset the licensing and royalty payments to such third party against royalties that would be owed to our partner, which may ultimately reduce the value of our royalty interest. An adverse outcome in infringement or other intellectual property-related proceedings could subject a marketer to significant liabilities to third parties, require disputed rights to be licensed from third parties or require the marketer to cease or modify its manufacturing, marketing and distribution of any affected product, any of which could reduce the amount of cash flow generated by the affected products and any associated royalties payable to us and therefore adversely affect our business, financial condition or results of operations.

Disclosure of trade secrets of marketers of products could negatively affect the competitive position of the products underlying our biopharmaceutical assets.

The marketers of the products that generate our royalties depend, in part, on trade secrets, know-how and technology, which are not protected by patents, to maintain the products’ competitive position. This information is typically protected through confidentiality agreements with parties that have access to such information, such as collaborative partners, licensors, employees and consultants. Any of these parties may breach the agreements and disclose the confidential information or competitors might independently develop or learn of the information in some other way, which could harm the competitive position of the products and therefore reduce the amount of cash flow generated by our royalties.

Our board of directors may make decisions with respect to the cash generated from our operations that may result in our not paying dividends or not repurchasing our ordinary shares.

Our board of directors is under no obligation to pay dividends, make distributions or repurchase our ordinary shares and it may decide to use cash to fund asset acquisitions or operations in lieu of paying dividends, making distributions or repurchasing our ordinary shares. We will pay Equity Performance Awards to anMr. ~~affiliate~~Legorreta ofand ~~the~~certain ~~Manager~~employees based on our Net Economic Profit regardless of whether any dividends are paid to our shareholders or any ordinary shares are repurchased. Our board of directors’ decisions with respect to our cash may result in our not paying dividends or not repurchasing our ordinary shares. Our board of directors’ decisions with respect to dividends or repurchases of ordinary shares may adversely affect the market price of our Class A ordinary shares. If we generate positive income, but pay limited or no dividends, holders of Class A ordinary shares may have tax liability on their income in excess of the actual cash dividends received by such holders.

The royalties that we acquire may fall outside the biopharmaceutical industry, and any such assets, and the cash flows therefrom, may not resemble the assets in our current portfolio.

We have discretion as to the types of assets that we may acquire. While we expect ~~the Manager~~ to acquire assets that primarily fall within the biopharmaceutical industry, we are not obligated to do so and may acquire other types of assets that are peripheral to or outside of the biopharmaceutical industry. Consequently, our asset acquisitions in the future, and the cash flows from such assets, may not resemble those of the assets in our current portfolio. We ~~and the Manager~~ may have limited experience acquiring assets that are peripheral to or outside of the biopharmaceutical industry. There can be no assurance that assets acquired in the future will have returns similar to the returns expected of the assets in our current portfolio or be profitable at all.

Risks Relating to Our Organization and Structure

We are a holding company ~~with no operations~~ and rely on ~~our~~cash ~~subsidiaries~~generated toby ~~provide~~our ussubsidiaries ~~with the funds necessary~~ to meet our financial obligations ~~and to pay dividends~~.

We are a holding company with no material direct operations. Our principal asset is our controlling equity interest in RP Holdings. As a result, we ~~are~~depend ~~dependent~~ on loans, dividends and other payments from our subsidiaries to generate the funds necessary to meet our financial obligations and to pay dividends, or make distributions to our shareholders and repurchase shares. Our subsidiaries are legally distinct from us and may be ~~prohibited~~subject orto ~~restricted~~contractual, ~~from~~legal, ~~providing loans~~regulatory, ~~paying~~financial ~~dividends~~ or ~~otherwise~~other ~~making~~restrictions ~~funds~~that ~~available~~limit their ability to usprovide ~~under~~funds ~~certain~~to ~~conditions~~us. If the cash we receive from our subsidiaries is insufficient ~~for us~~ to ~~fund~~meet our financial obligations, we may be required to raise ~~cash~~additional funds through the incurrence of debt, the issuance of equity or the sale of assets ~~to fund~~. However, there is no assurance that we would be able to ~~raise~~obtain ~~cash~~such byfinancing ~~these~~on ~~means.~~acceptable Ifterms, ~~the~~or ~~ability~~at ofall. ~~any~~Any oflimitation on the ability our subsidiaries to pay dividends or otherwise make ~~distributions~~funds oravailable ~~payments~~ to us is materially restricted by regulatory or legal requirements, bankruptcy or insolvency, or our need to maintain our financial strength ratings, or is limited due to operating results or other factors, it could adversely affect our ~~ability~~business, ~~to meet our~~ financial ~~obligations~~condition and ability to pay dividends, or make distributions to our shareholders or repurchase shares.

Our structure will result in tax distributions as a result of the RP Holdings Class C Special Interest.

RP Holdings is treated as a partnership for U.S. federal income tax purposes and has owners that are subject to U.S. federal income taxation. RP Holdings is required to make ~~cash~~ distributions, orof ~~tax~~cash ~~distributions,~~ to the direct owner or beneficial owners of the RP Holdings Class C Special Interest to cover such owner’s taxes, calculated using an assumed tax rate that is generally uniform for all recipients regardless of their individual tax status. ~~Funds~~The cash used by RP Holdings to satisfy ~~its~~these tax distribution obligations will not be available for reinvestment in our business, dividends or share repurchases.

Our ability to pay periodic dividends to our shareholders or make share repurchases may be limited by applicable provisions of English law and contractual restrictions and obligations.

Under English law, we will only be able to declare dividends, make distributions or repurchase shares (other than out of the proceeds of a new issuance of shares for that purpose) out of profits available for distribution. Profits available for distribution are accumulated, realized profits, to the extent that they have not been previously utilized by distribution or capitalization, less its accumulated, realized losses, to the extent that they have not been previously written off in a reduction or reorganization of capital duly made. The amount of our distributable reserves is a cumulative calculation. We may be profitable in a single financial year but unable to pay a dividend or make share repurchases if our accumulated, realized profits do not offset all previous years’ accumulated, realized losses. Additionally, we may only make a distribution if our net assets are not less than the amount of our aggregate called-up share capital and undistributable reserves, and if, and to the extent that, the distribution does not reduce the amount of those assets to less than that aggregate.

Subject to the terms of our indebtedness or other contractual obligations, the approval and payment of any interim dividends are at the sole discretion of our board of directors, which may change our dividend policy at any time, and the payment of any final dividends will be subject to majority approval by holders of our Class A ordinary shares and Class B ordinary shares and in each case will be paid out of profits available for that purpose under English law. Our Articles of Association authorize the board of directors to approve interim dividends without shareholder approval to the extent that such dividends appear justified by profits available for such purpose. The board of directors may also recommend final dividends be approved and declared by shareholders at an annual general meeting. No such dividend may exceed the amount recommended by the board of directors.

There can be no assurance that any dividends, whether quarterly or otherwise, will or can be paid or that any shares will or can be repurchased. Whether we pay dividends to our shareholders or make share repurchases depends on a number of factors, including among other things, general economic and business conditions, our strategic plans and prospects, our business and acquisition opportunities, our financial condition or results of operations, working capital requirements and anticipated cash needs, contractual restrictions and obligations, including fulfilling our current and future capital commitments, legal, tax and regulatory restrictions, other restrictions and implications on the payment of dividends by us to our shareholders or making any share repurchases and such other factors as our board of directors may deem relevant.

A shareholder who receives a distribution under circumstances where he or she knows or has reasonable grounds for believing that the distribution is unlawful in the circumstances is obliged to repay such distribution (or that part of it, as the case may be) to us.

If we were determined to be an investment company under the U.S. Investment Company Act of 1940, applicable restrictions could make it impractical for us to continue our business as contemplated and could adversely affect our business, financial condition or results of operations.

We intend to conduct our business so as not to become regulated as an investment company under the U.S. Investment Company Act. An entity generally will be determined to be an investment company for purposes of the U.S. Investment Company Act if, absent an applicable exemption, (i) it is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities; or (ii) it owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis, which we refer to as the ICA 40% Test.

We do not hold ourselves out as being engaged primarily, or propose to engage primarily, in the business of investing, reinvesting or trading in securities, and believe that we are not engaged primarily in the business of investing, reinvesting or trading in securities. We believe that, for U.S. Investment Company Act purposes, we are engaged primarily, through one or more of our subsidiaries, in the business of purchasing or otherwise acquiring certain obligations that represent part or all of the sales price of merchandise. Our subsidiaries that are so engaged rely on Section 3(c)(5)(A) of the U.S. Investment Company Act, which, as interpreted by the SEC staff, requires each such subsidiary to invest at least 55% of its assets in “notes, drafts, acceptances, open accounts receivable, and other obligations representing part or all of the sales price of merchandise, insurance, and services,” which we refer to as the ICA Exception Qualifying Assets.

In a no-action letter, dated August 13, 2010, to our predecessor, the SEC staff promulgated an interpretation that royalty interests that entitle an issuer to collect royalty receivables that are directly based on the sales price of specific biopharmaceutical assets that use intellectual property covered by specific license agreements are ICA Exception Qualifying Assets under Section 3(c)(5)(A). We rely on this no-action letter for the position that royalty receivables relating to biopharmaceutical assets that we hold are ICA Exception Qualifying Assets under Section 3(c)(5)(A) and Section 3(c)(6), which is described below.

To ensure that we are not obligated to register as an investment company, we must not exceed the thresholds provided by the ICA 40% Test. For purposes of the ICA 40% Test, the term investment securities does not include U.S. government securities or securities issued by majority-owned subsidiaries that are not themselves investment companies and are not relying on Section 3(c)(1) or Section 3(c)(7) of the U.S. Investment Company Act, such as majority-owned subsidiaries that rely on Section 3(c)(5)(A). We also may rely on Section 3(c)(6), which, based on SEC staff interpretations, requires us to invest, either directly or through majority-owned subsidiaries, at least 55% of our assets in, as relevant here, businesses relying on Section 3(c)(5)(A). Therefore, the assets that we and our subsidiaries hold and acquire are limited by the provisions of the U.S. Investment Company Act and the rules and regulations promulgated thereunder.

If the SEC or its staff in the future adopts a contrary interpretation to that provided in the no-action letter to our predecessor or otherwise restricts the conclusions in the SEC staff’s no-action letter such that royalty interests are no longer treated as ICA Exception Qualifying Assets for purposes of Section 3(c)(5)(A) and Section 3(c)(6), or the SEC or its staff in the future determines that the no-action letter does not apply to some or all types of royalty receivables relating to biopharmaceutical assets, our business will be materially and adversely affected. In particular, we would be required either to convert to a corporation formed under the laws of the United States or a state thereof (which would likely result in our being subject to U.S. federal corporate income taxation) and to register as an investment company, or to stop all business activities in the United States until such time as the SEC grants an application to register us as an investment company formed under non-U.S. law. It is unlikely that such an application would be granted and, even if it were, requirements imposed by the Investment Company Act, including limitations on our capital structure, our ability to transact business with affiliates and our ability to compensate key employees, could make it impractical for us to continue our business as currently conducted. Our ceasing to qualify for an exemption from registration as an investment company could materially and adversely affect the value of our Class A ordinary shares and our ability to pay dividends in respect of our Class A ordinary shares.

~~The equity performance awards payable to an affiliate of the Manager may create incentives that are not fully aligned with the interests of our shareholders.~~ 28

Subject to certain conditions, at the end of each fiscal quarter, an affiliate of the Manager is entitled to a distribution in the form of equity from RP Holdings in respect of each portfolio equal to 20% of the Net Economic Profit (defined as the aggregate cash receipts for all new portfolio investments in such portfolio less Total Expenses (defined as interest expense, operating expense and recovery of acquisition cost in respect of such portfolio)) for such portfolio for the applicable measuring period (the “Equity Performance Awards~~”).~~ ~~The right to Equity Performance Awards~~ may create anincentives ~~incentive~~that ~~for~~are ~~the~~not ~~Manager~~fully toaligned ~~make riskier or more speculative asset acquisitions. In addition, the Manager may cause us to incur more debt, finance additional asset acquisitions or otherwise use more leverage in connection~~ with ~~asset acquisitions, as generally~~ the ~~use~~interests of ~~leverage can increase the rate of return on an investment and therefore~~ our ~~profits. Under certain circumstances, the use of borrowed money may pose higher risks for our business or increase the likelihood of default, which would disfavor our~~ shareholders. In addition, there is no correlation between our profits and the obligation of our board of directors to pay dividends to shareholders. Consequently, shareholders may receive limited or no dividends while an affiliate of the Manager remains entitled to Equity Performance Awards based on our Net Economic Profit. In addition, even though Equity Performance Awards are payable on a portfolio-by-portfolio basis (with portfolios comprised of investments made during sequential two-year periods) in order to reduce the risks that affiliates of the Manager will be paid Equity Performance Awards on individual investments even though our overall portfolio of investments is not performing well, Equity Performance Awards may nevertheless be payable to affiliates of the Manager when our overall portfolio of investments is not performing as well as the individual portfolios that are used as the basis for measuring the Equity Performance Awards.

~~The~~Subject ~~Manager~~to ~~may~~certain beconditions, at the ~~subject~~end of each fiscal quarter, Mr. Legorreta and certain employees are entitled to a ~~change~~distribution in the form of ~~control~~equity ~~resulting~~from RP Holdings in arespect ~~disruption~~of each portfolio equal to 20% of the Net Economic Profit (defined as the aggregate cash receipts for all new portfolio investments in such portfolio less Total Expenses (defined as interest expense, operating expense and recovery of acquisition cost in respect of such portfolio)) for such portfolio for the applicable measuring period (the “Equity Performance Awards”). The right to Equity Performance Awards may create an incentive to make riskier or more speculative asset acquisitions. In addition, we may incur more debt, finance additional asset acquisitions or otherwise use more leverage in connection with asset acquisitions, as generally the use of leverage can increase the rate of return on an investment and therefore our ~~operations~~profits. ~~that~~Under ~~could~~certain ~~adversely~~circumstances, ~~affect~~the use of borrowed money may pose higher risks for our business or increase the likelihood of default, ~~financial~~which ~~condition~~would disfavor our shareholders. In addition, there is no correlation between our profits and the obligation of our board of directors to pay dividends to shareholders. Consequently, shareholders may receive limited or ~~results~~no dividends while Mr. Legorreta and certain employees remain entitled to Equity Performance Awards that may be substantial. Further, even though Equity Performance Awards are payable on a portfolio-by-portfolio basis (with portfolios comprised of ~~operations~~investments made during sequential two-year periods) in order to reduce the risks that we will pay Equity Performance Awards on individual investments even though our overall portfolio of investments is not performing well, Equity Performance Awards may nevertheless be payable when our overall portfolio of investments is not performing as well as the individual portfolios that are used as the basis for measuring the Equity Performance Awards.

There could be a change of control of the Manager and, in such a case, the new controlling party may have a different philosophy, employ less experienced advisory professionals, be unsuccessful in identifying royalty acquisition opportunities or have a track record that is not as successful as that of the Manager. If the foregoing were to occur, we could experience difficulty in making new asset acquisitions, and the value of our existing assets, our business, financial condition or results of operations could materially suffer.

The Manager’s liability is limited under the Management Agreement, and we have agreed to indemnify the Manager against certain liabilities. As a result, we could experience unfavorable operating results or incur losses for which the Manager would not be liable.

The Manager does not assume any responsibility other than to render the services called for under the Management Agreement. The Manager and its affiliates (including RPI EPA Holdings, LP) and their respective officers, directors, equity holders, members, employees, agents and partners, and any other person who is entitled to indemnification (each, an “Indemnitee”) is not liable to us, any subsidiary of ours, our directors, our shareholders or any subsidiary’s shareholders or partners for acts or omissions performed in accordance with to the Management Agreement, except those resulting from acts constituting fraud, bad faith, willful misconduct, gross negligence (as interpreted under New York law) and a material breach of the Management Agreement that is not cured or a violation of applicable securities laws.

In addition, to the fullest extent permitted by law, we have agreed to indemnify the Indemnitees from and against any and all claims, liabilities, damages, losses, penalties, actions, judgments, costs and expenses (including amounts paid in satisfaction of judgments, in compromises and settlements, as fines and penalties and legal or other costs and reasonable expenses of investigating or defending against any claim or alleged claim) of any nature whatsoever, known or unknown, liquidated or unliquidated that are incurred by any Indemnitee or to which such Indemnitee may be subject by reason of its activities on behalf of us or any of our subsidiaries to the extent that such Indemnitee’s conduct did not constitute fraud, bad faith, willful misconduct, gross negligence (as interpreted under New York law), material breach of the Management Agreement that is not cured or a violation of applicable securities laws. As a result, we could experience unfavorable operating results or incur losses for which the Manager would not be liable.

Operational risks may disrupt our businesses, result in losses or limit our growth.

We rely heavily on ~~the Manager’s~~ financial, accounting, information technology and ~~other~~ data processing systems ~~and cloud computing services~~, asincluding ~~well~~systems asoperated ~~those~~by of our current and future collaborators, contractors or consultants. Such systems are vulnerable to damage or interruption from computer viruses, data corruption, ~~cyber-related~~cybersecurity ~~attacks~~incidents, unauthorized access, natural disasters, pandemics, terrorism, war and telecommunication and electrical failures. If any of these events occur and such systems do not operate properly or are disabled or if there is any unauthorized disclosure of data, whether as a result of tampering, a breach of network security systems, a cybersecurity vulnerability or attack or otherwise, we could suffer substantial financial loss, increased costs, a disruption of our business, loss of trade secrets or other proprietary information, liability to us, regulatory intervention or reputational damage.

Furthermore, federal, state and international laws and regulations relating to data privacy and protection, such as the European Union’s General Data Protection Regulation and the California Consumer Privacy Act, can expose us to enforcement actions and investigations by regulatory authorities, and potentially result in regulatory penalties and significant legal liability, if our information technology security efforts or data privacy and protection compliance efforts fail. In addition, we operate a business that is highly dependent on information systems and technology. ~~The~~Our ~~Manager’s~~ information systems and technology may not continue to be able to accommodate our growth, and the cost of maintaining such systems may increase. Such a failure to accommodate growth, or an increase in costs related to such information systems, could adversely affect our business, financial condition or results of operations.

A disaster or a disruption in the public infrastructure that supports our business, including a disruption involving electronic communications or other services used by us or third parties with whom we conduct business, could adversely affect our ability to continue to operate our business without interruption. Our disaster recovery programs ~~and those of the Manager~~ may not be sufficient to mitigate the harm that may result from such a disaster or disruption. In addition, insurance and other safeguards might only partially reimburse us for our losses, if at all.

In addition, sustaining our growth may require us ~~or the Manager~~ to commit additional management, operational and financial resources to identify new professionals to join the team and to maintain appropriate operational and financial systems to adequately support expansion. Since the market for hiring talented professionals is competitive, we may not be able to grow at the pace we desire.

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We are subject to the U.K. Bribery Act, the U.S. Foreign Corrupt Practices Act and other anti-corruption laws, as well as export control laws, import and customs laws, trade and economic sanctions laws and other laws governing our operations.

Our operations are subject to anti-corruption laws, including the U.K. Bribery Act 2010 (“Bribery Act”), the U.S. Foreign Corrupt Practices Act of 1977, as amended the (“FCPA”), the U.S. domestic bribery statute contained in 18 U.S.C. §201, the U.S. Travel Act, and other anti-corruption laws that apply in countries where we do business. The Bribery Act, the FCPA and these other laws generally prohibit us and our employees and intermediaries from authorizing, promising, offering, or providing, directly or indirectly, improper or prohibited payments, or anything else of value, to government officials or other persons to obtain or retain business or gain some other business advantage. Under the Bribery Act, we may also be liable for failing to prevent a person associated with us from committing a bribery offense. We and the marketers of products that generate our royalties operate in a number of jurisdictions that pose a high risk of potential Bribery Act or FCPA violations, and we participate in collaborations and relationships with third parties whose corrupt or illegal activities could potentially subject us to liability under the Bribery Act, FCPA or local anti-corruption laws, even if we do not explicitly authorize or have actual knowledge of such activities. In addition, we cannot predict the nature, scope or effect of future regulatory requirements to which our international operations might be subject or the manner in which existing laws might be administered or interpreted.

We are also subject to other laws and regulations governing our international operations, including regulations administered by the governments of the United Kingdom and the United States, and authorities in the European Union, including applicable export control regulations, economic sanctions and embargoes on certain countries and persons, anti-money laundering laws, import and customs requirements and currency exchange regulations, collectively referred to as the “Trade Control laws.”

There is no assurance that we will be completely effective in ensuring our compliance with all applicable anti-corruption laws, including the Bribery Act, the FCPA or other legal requirements, including Trade Control laws. If we are not in compliance with the Bribery Act, the FCPA and other anti-corruption laws or Trade Control laws, we may be subject to criminal and civil penalties, disgorgement and other sanctions and remedial measures, and legal expenses, which could have an adverse impact on our business, financial condition, results of operations and liquidity. Likewise, any investigation of any potential violations of the Bribery Act, the FCPA, other anti-corruption laws or Trade Control laws by the United Kingdom, United States or other authorities could adversely affect our reputation, our business, financial condition or results of operations.

Efforts to ensure that our business arrangements with third parties will comply with applicable healthcare laws and regulations will involve substantial costs. Because of the breadth of these laws and the narrowness of the statutory exceptions and safe harbors available, it is possible that some of our business activities or our business arrangements with third parties could be subject to challenge under one or more of such laws. It is possible that governmental authorities will conclude that our business practices or the business practices of the marketers of products that generate our royalties may not comply with current or future statutes, regulations or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations or the operations of the marketers of products that generate are royalties are found to be in violation of any of these laws or any other governmental regulations, we or marketers of products that generate our royalties may be subject to significant criminal, civil and administrative sanctions, including monetary penalties, damages, fines, disgorgement, individual imprisonment and exclusion from participation in government-funded healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we or marketers of products that generate our royalties become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, reputational harm, and we or marketers of products that generate our royalties may be required to curtail or restructure operations, any of which could adversely affect our ability to operate our business and our results of operations.

The risk of our being found in violation of these laws is increased by the fact that many of them have not been fully interpreted by the regulatory authorities or the courts, and their provisions are open to a variety of interpretations. Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. The shifting compliance environment and the need to build and maintain robust and expandable systems to comply with multiple jurisdictions with different compliance or reporting requirements increases the possibility that a healthcare company may run afoul of one or more of the requirements.

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The EU directive on alternative investment fund managers (the “AIFM Directive”) may significantly increase our compliance costs.

The AIFM Directive has been implemented into the national law of the majority of member states of the European Economic Area and the United Kingdom (each an “AIFM state”). The AIFM Directive sets out minimum conditions related to the marketing of interests in alternative investment funds (such as our Class A ordinary shares) in the AIFM states and may impact our ability to attract investors in the AIFM states and may significantly increase our ~~and the Manager’s~~ compliance costs. Such conditions include requirements for us to register with the competent authority in the relevant AIFM state in order to market the Class A ordinary shares to investors, requirements to file periodic reports with the competent authority in the relevant AIFM state and requirements to comply with disclosure and reporting obligations in respect of investors in the relevant AIFM state. Such reports and disclosures may become publicly available. While such conditions are met in relation to the AIFM states where our Class A ordinary shares will be marketed, there can be no guarantee that this will continue to be the case. The AIFM Directive does not, however, prohibit an investor in such AIFM state from subscribing for our Class A ordinary shares at their own initiative in circumstances where such Class A ordinary shares have not been marketed in such AIFM state and we may issue our Class A ordinary shares to such investors, as long as they have provided us and the Manager with representations that they have done so at their own initiative.

In each AIFM state, our Class A ordinary shares may only be offered to investors in accordance with local measures implementing the AIFM Directive. Investors, together with any person making or assisting in the decision to invest in us, who are situated, domiciled or who have a registered office, in an AIFM state where our Class A ordinary shares are not being offered pursuant to private placement rules implementing the AIFM Directive may invest, or effect an investment in our Class A ordinary shares, but only in circumstances where they do so at their own initiative. Any investor acquiring our Class A ordinary shares at their own initiative in such AIFM state should note that as we have not been registered for marketing in that AIFM state, no reports will be filed with the competent authority in the relevant AIFM state by or in respect of us and no investor shall be entitled to receive any disclosure or report that is mandated in respect of an alternative investment fund being marketed pursuant to the AIFM Directive.

The United Kingdom implemented the AIFM Directive through the Alternative Investment Managers Regulations 2013 and the Financial Conduct Authority’s Handbook. Following the United Kingdom’s withdrawal the European Union and the expiration of the transitional period, the rules applicable to the marketing of interests in alternative investment funds in the United Kingdom and the other AIFM states remained largely aligned. However, there are now areas of divergence which may make it more time consuming and complex for us to market our Class A ordinary shares to investors in the United Kingdom and other AIFM states which, in turn, may significantly increase compliance costs.

~~Risks~~We ~~Relating~~may tonot ~~Our~~realize the anticipated benefits of the Internalization or we may be exposed to new risks and costs.

~~The~~We ~~Internalization~~ may not ~~close~~realize ~~due~~the anticipated benefits of the Internalization, such as cash savings, enhanced alignment with shareholders, increased investment returns, management continuity, transparency and governance, or greater structure simplification. Since our Internalization on May 16, 2025, we have become exposed to new costs and risks. Although we no longer pay a ~~variety~~management fee, our direct overhead has increased because we are responsible for all compensation and benefits of ~~factors~~our employees and other operating expenses. As an employer, ~~including~~we are subject to the ~~failure~~liabilities orand ~~significant~~risks ~~delay~~commonly infaced ~~obtaining~~by ~~required~~employers, ~~regulatory~~such ~~approvals~~as workers’ compensation claims, labor disputes and other employee-related grievances, ~~even~~and ifthe itcosts ~~does~~of ~~close,~~employee webenefit plans. Our overhead may ~~not~~increase ~~realize~~further in the ~~anticipated~~future ~~benefits~~as a result of our becoming internally managed as the responsibility for overhead relating to management of our business has become our own responsibility. In addition, while Mr. Legorreta has agreed to provide the board of directors with a reasonable opportunity to review and comment on future awards or modifications of Equity Performance Awards, Equity Performance Awards on existing and future investments will continue on their current terms and are ultimately controlled by Mr. Legorreta.

On January 10, 2025, RP Holdings entered into a Membership Interests Purchase Agreement (the “Purchase Agreement”) with Royalty Pharma, LLC, a Delaware limited liability company (“RP LLC”), the Manager, and the sellers named therein (the “Sellers”), pursuant to which, upon the terms and subject to the conditions set forth in the Purchase Agreement, including requisite shareholder approvals, RP Holdings expects to acquire all of the equity interests of RP LLC from the Sellers, who own the assets used by the Manager in its performance of the management functions provided to us pursuant to the Management Agreement.

If we internalize the Manager, we would become exposed to new and additional costs and risks. For example, while we would no longer bear the cost of the management fee paid to the Manager, our direct overhead would increase because we would be responsible for 100% of the compensation and benefits of our officers and other employees and our other operating expenses. While Mr. Legorreta has agreed to provide the Board with a reasonable opportunity to review and comment on future awards or modifications of Equity Performance Awards, Equity Performance Awards on existing and future investments would continue on the current terms. Our general and administrative expenses after the Internalization could also be higher than our current expectations.

The Share Consideration in connection with the Internalization, and future sales of our Class A ordinary shares by the Sellers may adversely affect the market price of our Class A ordinary shares.

The issuance of 24,530,266 non-voting Class E ordinary shares of RP Holdings (the “Share Consideration”), which may, upon vesting and redesignation as Class B ordinary shares of RP Holdings, that may be exchanged for our Class A ordinary shares in connection with the Internalization would have a dilutive effect and reduce the voting power and relative percentage interests of current Class A ordinary shareholders in our earnings and market value. The Share Consideration received by Mr. Legorreta is subject to vesting on a straight-line basis annually over five years and the Share Consideration received by certain executives of the Manager, other than Mr. Legorreta, are subject to vesting on a straight-line basis monthly over nine years, with vesting to commence effective January 1, 2025. If the Share Consideration in the Internalization vests, it would have a dilutive effect on our Class A ordinary shares. When recipients of the vested Share Consideration exchange part or all of it for our Class A ordinary shares, such exchanges would reduce the voting power and relative percentage interests of current Class A ordinary shareholders. Future sales of our Class A ordinary shares by the Sellers may adversely affect the market price of our Class A ordinary shares. These sales also might make it more difficult for us to sell equity securities in the future at a time and price we deem appropriate.

Certain of our officers and directors have interests in the Internalization that are different from, and may potentially conflict with, the interests of us and our shareholders.

The Internalization was negotiated between the Manager, which is controlled by Mr. Legorreta and is the employer of our officers, and the Company’s independent and disinterested directors. As a result, those officers and directors may have different interests from the Company as a whole. This potential conflict would not exist in the case of a transaction negotiated with unaffiliated third parties.

Moreover, if the Manager or any Seller breaches any of the representations, warranties or covenants made by in the Purchase Agreement, we may choose not to enforce, or to enforce less vigorously, our rights because of our desire to maintain our ongoing relationship with the Sellers and the interests of certain of our directors and officers. Moreover, the representations, warranties, covenants and indemnities in the Purchase Agreement are subject to limitations and qualifiers, which may also limit our ability to enforce any remedy under the Purchase Agreement.

Certain of our directors and officers have interests in the Internalization that may be different from, or in addition to, the interests of our shareholders generally and that may create potential conflicts of interest, including the payment of consideration in connection with the Internalization directly or indirectly to certain of these individuals, including Mr. Legorreta. Additionally, members of the Board and certain executives of the Manager have entered into voting agreements pursuant to which such individuals agreed to vote their shares (subject to certain exceptions) in favor of the transaction at the shareholder meeting. The respective roles of these executives in the Manager may create additional conflicts of interest in respect of the Internalization.

We may be exposed to risks to which we have not historically been exposed, including liabilities with respect to the assets acquired from the Manager.

The Internalization may expose us to risks to which we have not historically been exposed. Pursuant to the Purchase Agreement, we expect to incur liabilities with respect to the assets acquired from the Manager and certain of its affiliates. In addition, our overhead will increase as a result of our becoming internally managed, as the responsibility for overhead relating to management of our business borne by the Manager will become our own responsibility.

As an externally-managed company, we do not directly employ any employees. If the Internalization is approved by shareholders, we would employ persons who were associated with the Manager and its affiliates. As their employer, we would be subject to those potential liabilities that are commonly faced by employers, such as workers’ disability and compensation claims, potential labor disputes and other employee-related liabilities and grievances, and we would bear the costs of the establishment and maintenance of employee benefit plans, if established. There are no assurances that these employees would be able to provide us with the same level of services provided to us by the Manager, and there may be other unforeseen costs, expenses and difficulties associated with operating as an internally managed company.

Risks Relating to Our Ordinary Shares

The market price of our Class A ordinary shares has been and may in the future be volatile, which could cause the value of our shareholders’ investment to decline.

35The market price of our Class A ordinary shares has been and may be volatile and subject to wide fluctuations. During the year ended December 31, 2025, the per share trading price of our Class A ordinary shares ranged from a low of $25.75 to a high of $40.78. Market volatility, as well as general economic, market or political conditions, particularly those that relate to the biopharmaceutical industry, could reduce the market price of our Class A ordinary shares regardless of our operating performance. In addition to the other factors discussed in this Annual Report on Form 10-K, our operating results could be below the expectations of public market analysts and investors due to a number of potential factors, including:

The market price of our Class A ordinary shares has been and may be volatile and could be subject to wide fluctuations. Securities markets worldwide experience significant price and volume fluctuations. During the year ended December 31, 2024, the per share trading price of our Class A ordinary shares fluctuated from a low of $24.28 to a high of $31.33. Market volatility, as well as general economic, market or political conditions, could reduce the market price of Class A ordinary shares in spite of our operating performance. In addition to the factors discussed in this Annual Report on Form 10-K, our operating results could be below the expectations of public market analysts and investors due to a number of potential factors, including:

• market conditions in the broader stock market in general, or in our industry in particular;

~~• variations in our quarterly operating results or dividends to shareholders or share repurchases;~~ 31

• ~~additions~~variations in our quarterly operating results or ~~departures~~dividends ofto ~~key~~shareholders ~~management~~or ~~personnel~~share atrepurchases ~~the~~or ~~Manager;~~exchanges for our Class A ordinary shares;

• ~~the~~future ~~process~~sales ~~surrounding,~~of ~~and~~our ~~the~~Class ~~impact~~A ~~of,~~ordinary ~~the~~shares ~~potential~~by ~~internalization~~our ~~of the Manager~~affiliates;

• additions or departures of key management personnel;

• timing and rate of capital deployment, including relative to estimates;

• changes in our portfolio mix or acquisition strategy;

• failure to meet analysts’ earnings estimates;

• ~~publication~~analyst ofor ~~research~~media reports or other adverse publicity about us, our industry or related sectors;

• third-party healthcare reimbursement policies and practices;

• litigation and government investigations;

• changes or proposed changes in laws or regulations or differing interpretations or enforcement thereof ~~affecting our business~~;

• results, or projected results, from marketers of products that generate our royalties;

• results from, and any delays to, the clinical trial programs of development-stage product candidates underlying our biopharmaceutical assets or other issues relating to such products, including regulatory approval or commercialization;

• adverse market reaction to any indebtedness that we may incur or securities we may issue in the future;

• changes in market valuations of similar companies or speculation in the press or investment community;

• announcements by our competitors of significant contracts, acquisitions, dispositions, strategic partnerships, joint ventures or capital commitments; and

• economic ~~and~~or political ~~conditions or events~~developments, such as pandemics, inflation and interest rate volatility and ~~global~~geopolitical conflicts~~; and~~ .

~~• adverse~~These ~~publicity~~and ~~about~~other usfactors ormay ~~the~~cause ~~industries~~significant fluctuations in the market price or trading volume of our Class A ordinary shares, which wemay ~~participate~~limit our shareholders’ ability to sell their Class A ordinary shares at prices they consider satisfactory or ~~individual~~at ~~scandals~~all.

~~These~~Stock markets from time to time experience extreme price and ~~other~~volume ~~factors~~volatility, ~~may~~including ~~cause~~in recent periods. Following periods of volatility in the overall market and the market price of ~~and~~a ~~demand~~company’s ~~for~~securities, ~~our~~securities ~~Class~~class Aaction ~~ordinary~~litigation ~~shares~~has tooften ~~fluctuate~~been ~~significantly,~~instituted ~~which~~against ~~may~~public ~~limit~~companies. orIf ~~prevent~~such ~~our~~litigation ~~shareholders~~is ~~from~~instituted ~~reselling~~against ~~their~~us, ~~Class~~it Acould ~~ordinary~~result ~~shares~~in atsubstantial orcosts ~~above~~and ~~the~~a ~~purchase~~diversion ~~price~~of our management’s attention and resources.

Stock markets in general have from time to time experienced extreme price and volume fluctuations, including in recent months. In addition, in the past, following periods of volatility in the overall market and the market price of a company’s securities, securities class action litigation has often been instituted against public companies. This type of litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources. 32

Our Articles of Association provide that the courts of England and Wales will be the exclusive forum for the resolution of all shareholder complaints other than complaints asserting a cause of action arising under the Securities Act and the Exchange Act, and that the U.S. federal district courts will be the exclusive forum for the resolution of any shareholder complaint asserting a cause of action arising under the Securities Act and the Exchange Act.

Our Articles of Association provide that the courts of England and Wales will be the exclusive forum for resolving all shareholder complaints other than shareholder complaints asserting a cause of action arising under the Securities Act and the Exchange Act, and that the U.S. federal district courts will be the exclusive forum for resolving any shareholder complaint asserting a cause of action arising under the Securities Act and the Exchange Act. This choice of forum provision may limit a shareholder’s ability to bring a claim in a judicial forum that such shareholder finds favorable for disputes with us or our directors, officers or other employees, which may discourage lawsuits. If a court were to find either choice of forum provision contained in our Articles of Association to be inapplicable or unenforceable, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our results of operations and financial condition.

U.S. investors may have difficulty enforcing civil liabilities against our company, our directors or members of senior management.

We are a public limited company with our registered office in England and our subsidiaries are incorporated in various jurisdictions, including jurisdictions outside the United States. As a result, it may be difficult for investors to enforce ~~judgements~~judgments obtained in U.S. courts against us based on the civil liability provisions of the U.S. securities laws or otherwise. Even if shareholders are successful in bringing civil action against us, our directors or executive officers, the laws of England may render shareholders unable to enforce a judgment against our assets or the assets of our directors and executive officers. In addition, it is doubtful whether English courts would enforce certain civil liabilities under U.S. securities laws in original actions or judgments of U.S. courts based upon the civil liability provisions of the U.S. securities laws or otherwise. In addition, awards of punitive damages in actions brought in the United States or elsewhere may be unenforceable in the United Kingdom. An award for monetary damages under the U.S. securities laws would likely be considered punitive if it does not seek to compensate the claimant for loss or damage suffered and is intended to punish the defendant. The enforceability of any judgment in the United Kingdom will depend on the particular facts of the case as well as the laws and treaties in effect at the time. The United States and the United Kingdom do not currently have a treaty providing for recognition and enforcement of judgments (other than arbitration awards) in civil and commercial matters. As a result of the above, shareholders may have more difficulty in protecting their interest through actions against our management, directors or other shareholders than they would as shareholders of a U.S. public company.

The rights of our shareholders may differ from the rights typically offered to shareholders of a U.S. corporation.

We are incorporated under English law. The rights of our shareholders are governed by English law, including the provisions of the Companies Act 2006 (the “U.K. Companies Act”), and by our Articles of Association. These rights differ in certain respects from the rights of shareholders in typical U.S. corporations.

The U.K. City Code on Takeovers and Mergers (the “Takeover Code”) applies, among other things, to an offer for a public company whose registered office is in the United Kingdom (and the Channel Islands and the Isle of Man) and whose securities are not admitted to trading on a regulated market in the United Kingdom (or the Channel Islands or the Isle of Man) if the company is considered by the Panel on Takeovers and Mergers (the “Takeover Panel”) to have its place of central management and control in the United Kingdom (or the Channel Islands or the Isle of Man). This is known as the “residency test.” Under the Takeover Code, the Takeover Panel will determine whether we have our place of central management and control in the United Kingdom by looking at various factors, including the structure of our board of directors, the functions of the directors and where they are resident.

Given that our central management and control is situated outside the United Kingdom (or the Channel Islands or the Isle of Man), we do not anticipate that we will be subject to the Takeover Code. However, if at the time of a takeover offer, the Takeover Panel determines that we have our place of central management and control in the United Kingdom (or the Channel Islands or the Isle of Man), we would be subject to a number of rules and restrictions, including but not limited to the following: (i) our ability to enter into deal protection arrangements with a bidder would be extremely limited; (ii) we might not, without the approval of our shareholders, be able to perform certain actions that could have the effect of frustrating an offer, such as issuing shares or carrying out acquisitions or disposals; and (iii) we would be obliged to provide equality of information to all bona fide competing bidders.

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As a result of ~~recent~~ updates to the Takeover Code, any change in our place of central management and control will cease to be relevant after February 2, 2027, and therefore, on the assumption that our securities remain admitted to trading on the NASDAQ (or another regulated market outside the United Kingdom, the Channel Islands or the Isle of Man), the Takeover Code will not be applicable to us.

Under English law, and whether or not we are subject to the Takeover Code, an offeror for us that has acquired (i) 90% in value of; and (ii) 90% of the voting rights carried by the shares to which the offer relates may exercise statutory squeeze-out rights to compulsorily acquire the shares of the non-assenting minority. However, if an offer for us is conducted by way of a scheme of arrangement the threshold for the offeror obtaining 100% of Company shares comprises two components (i) approval by a majority in number of each class of Company shareholders present and voting at the shareholder meeting; and (ii) approval of Company shareholders representing 75% or more in value of each class of Company shareholders present and voting at that meeting.

As an English public limited company, certain capital structure decisions will require shareholder approval, which may limit our flexibility to manage our capital structure.

We are a public limited company incorporated under the laws of England and Wales. English law provides that a board of directors may only allot shares (or rights to subscribe for or convert into shares) with the prior authorization of shareholders, such authorization stating the aggregate nominal amount of shares that it covers and valid for a maximum period of five years, each as specified in the articles of association or relevant shareholder resolution. We obtained shareholder authority to allot additional shares until the end of the next annual general meeting of the Company or, if earlier, ~~the~~August ~~close of business on September 6~~12, ~~2025~~2026, the date that is 15 months after ~~June~~May 612, ~~2024~~2025. We intend to seek renewal of this authorization at each year’s annual general meeting of shareholders.

English law also generally provides shareholders with preemptive rights when new shares are issued for cash. However, it is possible for the articles of association, or for shareholders to pass a special resolution at a general meeting, being a resolution passed by at least 75% of the votes cast, to disapply preemptive rights. Such a disapplication of preemptive rights may be for a maximum period of up to five years from the date of adoption of the articles of association, if the disapplication is contained in the articles of association, or from the date of the shareholder special resolution, if the disapplication is by shareholder special resolution. In either case, this disapplication would need to be renewed by our shareholders upon its expiration (i.e., at least every five years). We have obtained authority from our shareholders to disapply preemptive rights until the end of the next annual general meeting of the Company or, if earlier, ~~the~~August ~~close of business on September 6~~12, ~~2025~~2026, which is the date that is 15 months after ~~June~~May 612, ~~2024~~2025, which disapplication will need to be renewed upon expiration to remain effective, but may be sought more frequently for additional five-year terms (or any shorter period). We intend to seek renewal of this authorization at each year’s annual general meeting of shareholders.

English law prohibits us from repurchasing our shares by way of “off market purchases” without the prior approval of shareholders by ordinary resolution (i.e., majority of votes cast by our shareholders), and other formalities. Such approval may be for a maximum period of up to five years but may be sought more frequently. English law prohibits us from conducting “on market purchases” as our shares are listed on the NASDAQ and will not be traded on a recognized investment exchange in the United Kingdom.

Our shareholders approved the authorization of certain “off market purchases” that will expire five years from ~~June~~May 2312, ~~2022~~2025 unless renewed by our shareholders prior to the expiration date. We cannot assure shareholders that situations will not arise where such shareholder approval requirements for any of these actions would deprive our shareholders of substantial capital management benefits.

If our Class A ordinary shares are not eligible for continued deposit and clearing within the facilities of DTC, then transactions in our securities may be disrupted.

The facilities of The Depository Trust Company (“DTC”) are a widely-used mechanism that allow for rapid electronic transfers of securities between the participants in the DTC system, which include many banks and brokerage firms. While our Class A ordinary shares are eligible for deposit and clearing within the DTC system, DTC has discretion to cease to act as a depository and clearing agency for our Class A ordinary shares, including to the extent that any changes in U.K. law change the stamp duty or stamp duty reserve tax position in relation to the Class A ordinary shares. If DTC determined that the Class A ordinary shares were not eligible for continued deposit and clearance within its facilities, our Class A ordinary shares may not be eligible for continued listing on the NASDAQ and trading in the Class A ordinary shares would be disrupted. While we would pursue alternative arrangements to preserve our listing and maintain trading, any such disruption could adversely affect the market price of our Class A ordinary shares and our access to the capital markets.

The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain qualified board members.

As a public company, we are subject to the reporting requirements of the Exchange Act, the requirements of the U.S. Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”), and the requirements of the U.K. Companies Act and, if applicable, the Takeover Code. The requirements of these rules and regulations increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources.

We are obligated to file with the SEC annual and quarterly information and other reports that are specified in the Exchange Act, and therefore will need to have the ability to prepare financial statements that are compliant with all SEC reporting requirements on a timely basis. In addition, we are subject to other reporting and corporate governance requirements, including certain requirements of Nasdaq and certain provisions of the Sarbanes-Oxley Act and the regulations promulgated thereunder, which will impose significant compliance obligations upon us.

We are required to comply with Section 404 of the Sarbanes-Oxley Act, which requires management assessments of the effectiveness of internal control over financial reporting and disclosure controls and procedures. If we are unable to maintain effective internal control over financial reporting or disclosure controls and procedures, our ability to record, process and report financial information accurately and to prepare financial statements within required time periods could be adversely affected, which could subject us to regulatory consequences, including sanctions by the SEC, negatively affect investor confidence in our financial statements, restrict access to capital markets and adversely impact the market price of our Class A ordinary shares.

Our compliance with the requirements under the Exchange Act, the Sarbanes-Oxley Act, the U.K. Companies Act and, if applicable, the Takeover Code and the rules and regulations thereunder increases our legal and financial compliance costs and makes some activities more time consuming and costly. These rules and regulations have made it more difficult and more expensive for us to obtain directors’ and officers’ liability insurance, and we may in the future be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers. We may not be able to predict or estimate accurately the amount of additional costs we may incur or the timing of such costs.

Risks Relating to Taxation

Our structure involves complex provisions of tax law for which no clear precedent or authority may be available. Our structure also is subject to potential legislative, judicial or administrative change and differing interpretations, possibly on a retroactive basis.

Our tax treatment, including Irish, U.K. and U.S. federal income tax treatment, depends in some instances on determinations of fact and interpretations of complex provisions of applicable tax law for which no clear precedent or authority may be available. You should be aware that our tax position is not free from doubt, and that applicable tax rules are generally subject to ongoing review by legislative and administrative bodies and relevant tax authorities, as well as by the Organization for Economic Co-operation and Development (“OECD”), which is continuously considering recommendations for changes to existing tax rules. Furthermore, over 140 member jurisdictions of the G20/OECD Inclusive Framework have joined the Two-Pillar Solution to Address the Tax Challenges of the Digitalization of the Economy as part of the OECD’s base erosion and profit sharing project (“BEPS”), which includes a reallocation of taxing rights among market jurisdictions and model rules for a global minimum tax rate of 15% (“Pillar Two”).

As part of the ~~ongoing~~implementation ~~release~~ of the Pillar Two rules by various jurisdictions, the ~~Finance~~United ~~(No.~~Kingdom 2)has ~~Act~~adopted ~~2023 (~~the ~~“UK Act”) was enacted on July 11, 2023, and implements the OECD’s BEPS~~ Pillar Two income inclusion rule, including a multinational top-up tax and a domestic top-up tax to the minimum effective tax rate of 15% for relevant accounting periods ~~beginning on or after December 31, 2023~~. In ~~October 2024~~addition, ~~additional~~the ~~draft~~United UKKingdom ~~legislation~~has ~~(Finance~~introduced ~~Bill 2024-25) was published that provides for~~ the ~~introduction of the~~ Pillar Two undertaxed profits rule ~~(“UTPR”). It is currently anticipated that the UTPR will be implemented in 2025 in respect of accounting periods commencing on or after December 31~~, ~~2024. The UTPR is~~ a protective measure that requires subsidiaries to collect top-up taxes ~~in cases~~ where a parent jurisdiction has not implemented the Pillar Two ~~Income~~income ~~Inclusion~~inclusion ~~Rule~~rule. ~~The UK Act also includes a transitional safe harbor election for accounting periods beginning on or before December 31, 2026.~~ Similar legislation ~~was~~has been enacted in Ireland ~~on December 18, 2023 (the “Irish Act”)~~. While we do not expect to be subject to material UK tax charges under the Pillar Two rules, there remains a risk that a tax ~~authority~~authorities in any relevant jurisdiction implementing Pillar Two could adopt or interpret legislation, ~~statements~~administrative guidance or ~~guidance~~related statements in a manner that is inconsistent with our understanding of the ~~UK Act, the Irish Act and OECD’s BEPS~~ Pillar Two model rules and associated commentary.

39The United States has taken the position that BEPS has no force or effect in the United States absent action by the U.S. Congress. The U.S. Department of Treasury and U.S. Congress have explored potential protective or retaliatory measures against non-U.S. companies and investors if their home jurisdictions impose discriminatory or extraterritorial taxes on U.S. companies, potentially including Pillar Two. We cannot predict whether the United States will adopt any such protective measures or whether any such legislation will be adopted, or whether or how any non-U.S. countries may change their tax laws, including with respect to taxes imposed under Pillar Two. It is possible that any changes in U.S. or non-U.S. tax law could adversely affect our future tax liabilities and our effective tax rate.

OnAs ~~January~~proposals ~~20,~~to ~~2025,~~change ~~the~~tax ~~Trump~~laws ~~administration~~and ~~issued~~implement anthe ~~executive order declaring that~~ BEPS ~~has~~framework noremain ~~force~~subject orto ~~effect~~further innegotiation, ~~the~~we ~~U.S.~~are ~~absent~~currently ~~congressional~~unable ~~action,~~to ~~and~~predict ~~directing~~ the ~~U.S.~~extent ~~Department of Treasury~~ to ~~(i)~~which ~~investigate whether~~ any ~~non-U.S.~~changes ~~countries~~to ~~are not in compliance with any U.S.~~ tax ~~treaty~~laws, orstatutes, ~~have~~rules, ~~implemented~~regulations or ~~are~~ordinances ~~likely~~will tooccur ~~implement~~and, ~~tax~~if ~~rules~~so, ~~that~~the ~~are~~ultimate ~~extraterritorial~~impact oron ~~disproportionately~~our ~~affect U~~business.S. ~~companies,~~These ~~which~~review ~~may~~processes ~~include~~could ~~actions~~result orin ~~taxes~~revised ~~imposed~~interpretations ~~under~~of ~~Pillar~~established ~~Two~~concepts, ~~and~~statutory ~~(ii)~~changes, ~~develop~~revisions ~~options for “protective measures” in response~~ to ~~any~~regulations ~~such~~and ~~noncompliance~~other ormodifications ~~tax~~and ~~rules~~interpretations. InNo ~~addition,~~ruling ~~legislation~~will ~~has~~be ~~been~~sought ~~introduced~~from in the ~~U.S.~~relevant ~~Congress~~tax ~~that~~authority ~~would~~regarding ~~increase~~any ~~U.S.~~of the tax ~~rates~~issues ondiscussed ~~non-U.S.~~herein, ~~companies~~ and ~~investors~~no ifassurance ~~their~~can ~~home~~be ~~jurisdictions~~given ~~impose~~that ~~discriminatory or extraterritorial taxes on U.S. companies. We cannot predict whether~~ the ~~U.S.~~relevant ~~will~~tax ~~adopt~~authorities ~~any such protective measures or whether any such legislation~~ will benot ~~adopted,~~challenge ~~or whether or how~~ any ~~non-U.S.~~of ~~countries~~our ~~may change their~~ tax ~~laws,~~positions ~~including~~and ~~with~~that ~~respect~~such tochallenge ~~taxes~~would ~~imposed~~not ~~under~~succeed. ~~Pillar~~If ~~Two, in response to the executive order,~~ any ~~action~~such ~~taken~~position ~~thereunder or the legislation described above. It~~ is ~~possible~~successfully ~~that~~challenged, ~~any~~our ~~changes~~tax inreporting ~~U.S.~~ or ~~non-U.S.~~ tax ~~law~~liabilities could ~~have~~materially ~~material~~increase, ~~adverse~~which ~~effect~~would onadversely affect our ~~future~~profitability ~~tax liabilities~~ and ~~our~~cash ~~effective tax rate~~flows.

As proposals to change tax laws and the implementation of the BEPS framework remain subject to further negotiation, we are currently unable to predict the extent to which any changes to tax laws, statutes, rules, regulations or ordinances will occur and, if so, the ultimate impact on our business. These review processes could result in revised interpretations of established concepts, statutory changes, revisions to regulations and other modifications and interpretations. No ruling will be sought from the relevant tax authority regarding any of the tax issues discussed herein, and no assurance can be given that the relevant tax authorities will not challenge any of our tax positions and that such challenge would not succeed. If any such position is successfully challenged, our tax reporting or tax liabilities could materially increase, which would adversely affect our profitability and cash flows. 35

There have been significant changes both made and proposed to international tax laws that increase the complexity, burden and cost of tax compliance for all multinational companies. We expect to continue to monitor these and other developments in international tax law.

We could be liable for significant taxes due to changes in our eligibility for certain income tax treaty benefits or challenges to our tax positions with respect to the application of income tax treaties.

Our subsidiaries expect to receive revenues from both U.S. and non-U.S. sources. We expect that our subsidiaries generally will be eligible for benefits under the applicable income tax treaties between Ireland and the jurisdictions where income is sourced. However, no assurances can be provided in this regard, and it is possible that a taxing authority could successfully assert that any of our subsidiaries does not qualify for treaty benefits as a result of its failure to satisfy the applicable requirements to be eligible to claim treaty benefits. If a taxing authority were to challenge our position regarding the application of an applicable income tax treaty, we could become subject to increased withholding taxes, and such taxes could be significant.

Specifically, with respect to certain U.S.-source income, we expect that our subsidiaries will be eligible for benefits under the U.S.-Ireland income tax treaty (the “Treaty”), and, under that Treaty, will not be subject to any U.S. withholding taxes on such U.S.-source payments. Our current treaty position with respect to U.S.-source payments relies in part on U.S. citizens or tax residents (as defined for purposes of the Treaty) owning, directly or indirectly, at least 50% of the beneficial interest in, or at least 50% of the aggregate vote and value of, each of our subsidiaries that earns U.S.-source income. Our treaty position is based on the current U.S. status of the majority of the existing indirect investors in RP Holdings and ~~Old~~Royalty Pharma Investments 2011 ICAV (“RPI 2011 ICAV”). Subject to certain exceptions, the existing indirect U.S. investors in RP Holdings have the right to exchange their interests for our publicly traded Class A ordinary shares. Such publicly traded Class A ordinary shares could be further transferred on the public market to other persons. Therefore, it is possible that over time U.S. persons will own indirectly in the aggregate less than 50% of the interests in our subsidiaries. We currently expect that our Class A ordinary shares and other existing indirect interests in RP Holdings and ~~Old~~ RPI 2011 ICAV in the aggregate will continue to be owned in sufficient amount by U.S. citizens or tax residents, and that we will be able to establish such ownership, for purposes of satisfying the 50% ownership requirement under the Treaty. However, there is no assurance that RP Holdings and ~~Old~~ RPI 2011 ICAV will continue to be owned directly or indirectly by sufficient U.S. citizens or residents or that we will be able to establish to the IRS’ satisfaction such ownership for purposes of satisfying the 50% U.S. ownership requirement under the Treaty. It is possible that if the indirect U.S. ownership in our subsidiaries becomes lower than 50% (or we cannot establish such ownership) we may in the future be able to qualify for another applicable exemption from U.S. withholding under the Treaty, but there can be no assurance in this regard. A substantial portion of our revenue is, and is expected to continue to be, derived from U.S.-sourced income, such as royalties, interest or “other income” for Treaty purposes. Therefore, if our subsidiaries failed to qualify for an exemption from U.S. withholding tax under the Treaty (by satisfying either the 50% U.S. ownership requirement or an alternative Treaty exemption) and such types of income were subject to a 30% U.S. withholding tax, our financial position, profitability and cash flows could be adversely affected.

40The Irish Department of Finance has engaged in discussions with the U.S. Treasury on updating certain elements of the Treaty. It is at this time not clear what elements of the Treaty may be updated, or when any such updates would go into effect. However, certain elements of the revised U.S. Model Income Tax Convention could, if included in an update to the Treaty, result in our subsidiaries being unable to qualify for the benefits of the Treaty or eliminate or reduce the benefits of the Treaty that otherwise would have been available to us. If our subsidiaries are unable to qualify for the benefits of the Treaty, or if any benefits of the Treaty that otherwise would have been available to us are eliminated or reduced, then all or a portion of our income may become subject to increased withholding taxes, and such taxes could be very significant and materially and adversely affect our financial position, profitability and cash flows.

OnIn ~~August 25~~addition, ~~2016,~~U.S. ~~the~~authorities ~~Irish~~have ~~Department~~from oftime ~~Finance~~to ~~announced~~time ~~that,~~reviewed inwhether ~~the~~non-U.S. ~~context~~jurisdictions ofare ~~the~~acting ~~publication~~inconsistently bywith ~~the United States Treasury Department of a revised~~ U.S. ~~Model~~tax ~~Income~~treaties ~~Tax~~or ~~Convention~~have inimplemented ~~February~~or ~~2016,~~are ~~discussions~~likely ~~have~~to ~~begun~~implement ~~with~~tax ~~the~~rules ~~United~~that ~~States~~are ~~Treasury~~viewed onas ~~updating~~extraterritorial ~~certain~~or ~~elements~~as ofdisproportionately ~~the~~affecting ~~Treaty~~U.S. Itcompanies isand athave ~~this~~considered ~~time~~potential ~~not~~protective ~~clear~~measures ~~what elements of the Treaty may be updated,~~ or ~~when~~retaliatory ~~any~~measures ~~such~~in ~~updates would go into effect~~response. ~~However,~~It ~~certain~~is ~~elements~~unclear ofwhether the ~~revised~~Treaty ~~U.S.~~could ~~Model~~be ~~Income~~implicated ~~Tax~~in ~~Convention~~any ~~could,~~such ifreview ~~included~~or inwhether anany ~~update~~measures tothat ~~the~~may ~~Treaty,~~be ~~result~~adopted incould affect our ~~subsidiaries~~ability ~~being unable~~ to qualify for ~~the~~Treaty benefits ofor ~~the~~reduce ~~Treaty~~ or eliminate orthose ~~reduce the~~ benefits. ofWe ~~the~~cannot ~~Treaty~~know ~~that~~at ~~otherwise~~this ~~would~~time ~~have~~whether ~~been~~or ~~available~~when tothe ~~us.~~United IfStates ~~our~~will ~~subsidiaries~~adopt ~~are~~any ~~unable~~such toprotective ~~qualify~~measures, ~~for~~or ~~the~~whether ~~benefits~~or ofhow ~~the~~Ireland ~~Treaty,~~may orchange ifits ~~any~~interpretation ~~benefits~~or enforcement of the Treaty ~~that~~or ~~otherwise~~other ~~would~~tax ~~have~~laws ~~been~~in ~~available~~response to usany ~~are~~action ~~eliminated~~taken orby ~~reduced,~~U.S. ~~then~~authorities. ~~all~~It oris apossible ~~portion~~that ofany ~~our~~changes ~~income~~in ~~may~~U.S. ~~become~~or ~~subject~~non-U.S. totax ~~increased~~law ~~withholding taxes, and such taxes~~ could ~~be very significant and materially and~~ adversely affect our ~~financial~~eligibility ~~position,~~for ~~profitability~~benefits ~~and~~under ~~cash~~the ~~flows~~Treaty.

As noted above, an executive order issued by the Trump administration on January 20, 2025 directs the U.S. Department of Treasury to (i) investigate whether any non-U.S. countries are not in compliance with any U.S. tax treaty or have implemented or are likely to implement tax rules that are extraterritorial or disproportionately affect U.S. companies, and (ii) develop options for “protective measures” in response to any such noncompliance or tax rules. It is not clear at this time whether the Treaty may be implicated in the findings produced as a result of this order, or whether any “protective measures” may be recommended that could impact our ability to qualify for the benefits of the Treaty or eliminate or otherwise reduce the benefits of the Treaty. We cannot know at this time whether or when the United States will adopt any such protective measures, or whether or how Ireland may change its interpretation or enforcement of the Treaty or other tax laws in response to the executive order, or to any action taken thereunder. It is possible that any changes in U.S. or non-U.S. tax law could have material adverse effect on our eligibility for benefits under the Treaty. 36

If our subsidiaries are considered to be engaged in a U.S. trade or business, we could be liable for significant U.S. taxation.

In general, if a foreign corporation, such as Royalty Pharma plc, is considered to be engaged in a U.S. trade or business, such corporation’s share of any income that is effectively connected with such U.S. trade or business will be subject to regular U.S. federal income taxation (currently imposed at a maximum rate of 21%) on a net basis and, potentially, an additional 30% U.S. “branch profits” tax on distributions attributable to income that is effectively connected with such U.S. trade or business. In addition, it is possible that such corporation could be subject to taxation on a net basis by state or local jurisdictions within the United States. WeWith limited exceptions, we intend to conduct our activities, through our subsidiaries, such that no income realized by us will be effectively connected with the conduct of a U.S. trade or business or otherwise subject to regular U.S. federal income taxation on a net basis. If we are able to conduct our activities in this way, income or gains realized by us will not be subject to U.S. net federal income taxation. However, no assurance can be provided in this regard. The proper characterization of our income and gains for U.S. tax purposes is not certain, and it is possible that all or a portion of our income and gains could be characterized as income that is “effectively connected” with the conduct of a U.S. trade or business. If our income and gains were characterized as effectively connected with a U.S. trade or business, we would be subject to significant U.S. taxes plus interest and possible penalties, and our financial position, cash flows and profitability could be materially and adversely affected.

We expect to operate, and expect that RP Holdings will operate, so as to be treated solely as a resident of the U.K. for tax purposes, but changes to our management and organizational structure or to the tax residency laws of other jurisdictions where we operate may cause the relevant tax authorities to treat us or RP Holdings as also being a resident of another jurisdiction for tax purposes.

Under current U.K. tax law, a company that is incorporated in the U.K. is regarded as resident for tax purposes in the U.K. unless (i) it is concurrently treated as resident for tax purposes in another jurisdiction (applying the rules of that other jurisdiction for determining tax residency) that has a double tax treaty with the U.K. and (ii) there is a residency tie-breaker provision in that tax treaty which allocates tax residence to that other jurisdiction.

Based upon our anticipated management and organizational structure, we believe that we and RP Holdings should be regarded as tax resident solely in the U.K. However, because this analysis is highly factual and may depend on future changes in our management and organizational structure, as well as future changes in the tax residency laws of other jurisdictions where we operate, there can be no assurance regarding the determination of our tax residence in the future.

As U.K. tax resident companies, we and RP Holdings will be subject to U.K. corporation tax on our worldwide taxable profits and gains. Should we (or RP Holdings) be treated as resident in a jurisdiction other than the U.K., we (or RP Holdings, as applicable) could be subject to taxation in that jurisdiction and may be required to comply with a number of material and formal tax obligations, including withholding tax or reporting obligations provided under the relevant tax law, which could result in additional costs and expenses.

We believe that we should not be subject to material U.K. corporation tax in respect of certain profits of our non-U.K. tax resident subsidiaries as a result of the U.K.’s “controlled foreign companies” rules but it cannot be guaranteed that this will continue to be the case.

As U.K. tax resident companies, we and RP Holdings will be subject to the U.K.’s “controlled foreign companies” rules (the “U.K. CFC Rules”). The U.K. CFC Rules, broadly, can impose a charge to U.K. tax on U.K. tax resident companies that have, alone or together with certain other persons, interests in a non-U.K. tax resident company (the “Controlled Foreign Company”) which is controlled by a U.K. person or persons. The charge under the U.K. CFC Rules applies by reference to certain types of chargeable profit arising to the Controlled Foreign Company, whether or not that profit is distributed, subject to specific exemptions. The types of profits of a Controlled Foreign Company that can potentially be subject to a U.K. corporation tax charge under the U.K. CFC Rules include business profits of the Controlled Foreign Company that are attributable to assets or risks that are managed by activities in the U.K., or certain finance profits of the Controlled Foreign Company that arise from capital or other assets contributed, directly or indirectly, to the Controlled Foreign Company from a connected U.K. tax resident company.

Certain non-U.K. entities in which we hold a greater than 25% interest, including RPI 2019 ICAV (which is Irish tax resident) and Old RPI (which is Irish tax resident and which is held indirectly by us through our participation in RP Holdings), will be Controlled Foreign Companies for U.K. tax purposes. We and RP Holdings will therefore be required to apply the CFC Rules in respect of our direct and indirect interests in these entities on an ongoing basis. We do not expect material U.K. corporation tax charges to arise under the U.K. CFC Rules in respect of our royalty assets or our financing arrangements, however no assurances can be given that this will continue to be the case. The U.K. CFC Rules are highly complex and fact-dependent, and changes to, or adverse interpretations of, these rules, or changes in the future activities of RPI 2019 ICAV or other non-U.K. companies in which we hold an interest, directly or indirectly, may alter this position and could impact our group’s effective tax rate. 37

Certain non-U.K. entities in which we hold a greater than 25% interest, including RPI 2019 ICAV (which is Irish tax resident) and RPI 2011 ICAV (which is Irish tax resident and which is held indirectly by us through our participation in RP Holdings), will be Controlled Foreign Companies for U.K. tax purposes. We and RP Holdings will therefore be required to apply the CFC Rules in respect of our direct and indirect interests in these entities on an ongoing basis. We do not expect material U.K. corporation tax charges to arise under the U.K. CFC Rules in respect of our royalty assets or our financing arrangements, however no assurances can be given that this will continue to be the case. The U.K. CFC Rules are highly complex and fact-dependent, and changes to, or adverse interpretations of, these rules, or changes in the future activities of RPI 2019 ICAV or other non-U.K. companies in which we hold an interest, directly or indirectly, may alter this position and could impact our group’s effective tax rate.

We believe that dividends received by us and RP Holdings should be exempt from U.K. corporation tax, but it cannot be guaranteed that this will continue to be the case.

U.K. tax resident companies are subject to U.K. corporation tax on receipt of dividends or other income distributions in respect of shares held by them, unless those dividends or other distributions fall within an exempt class. We believe that dividends received by us from RP Holdings, and dividends received by RP Holdings from RPI 2019 ICAV, should fall within such an exempt class and therefore should not be subject to U.K. corporation tax. However, a number of conditions must be met in order for such dividends to qualify for this tax exemption, including (in respect of dividends paid by RPI 2019 ICAV, which is tax resident in Ireland) conditions relating to the application of Irish tax law. As such, it cannot be guaranteed that these conditions for the U.K. tax exemption in respect of distributions will continue at all times to be satisfied. If distributions received by us or by RP Holdings were not to fall within an exempt class, such distributions would likely be subject to U.K. corporation tax at the then prevailing corporation tax rate.

Even where distributions fall within an exempt class, certain anti-avoidance and recharacterization rules may also apply. For instance, if RPI 2019 ICAV were to constitute an “offshore fund” for U.K. tax purposes that has at any time in an accounting period more than 60% by market value of its investments in debt securities, money placed at interest (other than cash awaiting investment), certain contracts for differences, or in holdings in other offshore funds with, broadly, more than 60% of their investments similarly invested, RP Holdings’ shareholding in RPI 2019 ICAV may be subject to U.K. corporation tax as a deemed “loan relationship”, with the result that dividends received by RP Holdings from RPI 2019 ICAV could be subject to U.K. tax as deemed interest and RP Holdings may be subject to U.K. corporation tax on increases in the fair market value of its shareholding in RPI. The term “offshore fund” is defined for U.K. tax purposes through a characteristics-based approach and, broadly, can include arrangements constituted by a non-U.K. resident body corporate in which a reasonable investor would expect to be able to realize their investment entirely, or almost entirely, by reference to net asset value. We believe and have been advised that RP Holdings’ shareholding in RPI 2019 ICAV should not fall within these rules, however no guarantee can be offered that this will continue to be the case. Changes to, or adverse interpretations of, the offshore funds rules, or changes in the nature of our investments, may alter this position and could impact our group’s effective rate.

WeSince 2020, we have been classified as a PFIC for U.S. federal income tax purposes, and we expect to be classified as a PFIC for U.S. federal income tax purposes for the year ended December 31, ~~which~~2025. Being classified as a PFIC could subject U.S. holders of our Class A ordinary shares to adverse U.S. federal income tax consequences. ~~Distributions~~While we are classified as a PFIC, distributions that we pay to individual and other non-corporate U.S. holders will not be eligible for taxation at reduced rates, which could potentially adversely affect the value of our Class A ordinary shares.

42Since 2020, we have been classified as a PFIC for U.S. federal income tax purposes, and we expect to be classified as a PFIC for U.S. federal income tax purposes for the year ended December 31, 2025. Whether we are classified as a PFIC is generally only relevant for taxable U.S. holders of our Class A ordinary shares. Our PFIC classification is unrelated to our corporate tax status.

We generally expect that our income, which consists primarily of passive income, and our assets, which consist primarily of assets that produce passive income, will result in our treatment as a PFIC for the current taxable year and future taxable years. We intend to annually furnish U.S. holders a “PFIC Annual Information Statement” with the information required to allow shareholders to make a qualified electing fund (“QEF”) election for United States federal income tax purposes on our website. U.S. holders who do not make a QEF election with respect to us or a mark-to-market election with respect to our Class A ordinary shares will be subject to potentially material adverse tax consequences, including (i) the treatment of any gain on disposition of our Class A ordinary shares as ordinary income and (ii) the application of a deferred interest charge on such gain and the receipt of certain distributions on our Class A ordinary shares. In addition, regardless of whether a QEF or mark-to-market election is made with respect to us, U.S. holders will be required to file an annual report on IRS Form 8621 containing such information with respect to its interest in a PFIC as the IRS may require. Failure to file IRS Form 8621 for each applicable taxable year may result in substantial penalties and result in audit by the IRS. Further, if we are a PFIC for any taxable year during which a U.S. holder owns our Class A ordinary shares, we generally would continue to be treated as a PFIC with respect to that U.S. holder for all succeeding years during which such person holds our Class A ordinary shares, even if we ceased to meet the threshold requirements for PFIC status, unless the U.S. holder makes a special “purging” election on IRS Form 8621. The effect of these adverse tax consequences could adversely affect our U.S. shareholders and make investment in our Class A ordinary shares less attractive to U.S. investors.38

~~Distributions~~So ~~made~~long as we are classified as a PFIC, we intend to ~~non-corporate~~furnish annually to U.S. holders ~~will~~a ~~not~~“PFIC beAnnual ~~eligible~~Information Statement” with the information required to allow shareholders to make a qualified electing fund (“QEF”) election for ~~taxation~~United atStates ~~reduced~~federal income tax ~~rates~~purposes ~~generally~~on ~~applicable~~our towebsite. ~~dividends~~So ~~paid~~long byas ~~certain~~we are classified as a PFIC, U.S. ~~corporations~~holders ~~and~~who ~~“qualified~~do ~~foreign~~not ~~corporations”~~make ~~because~~a QEF election with respect to us or a mark-to-market election with respect to our Class A ordinary shares will be subject to potentially material adverse tax consequences, including (i) the treatment of any gain on disposition of our ~~status~~Class A ordinary shares as ordinary income and (ii) the application of a ~~PFIC~~deferred interest charge on such gain and the receipt of certain distributions on our Class A ordinary shares. ~~The~~In ~~more~~addition, ~~favorable~~regardless ~~rates~~of ~~applicable~~whether a QEF or mark-to-market ~~qualifying~~election ~~corporate~~is ~~dividends~~made ~~could~~with ~~cause~~respect ~~individuals~~to us, U.S. holders will be required to ~~perceive~~file ~~investment~~an annual report on IRS Form 8621 containing such information with respect to its interest in a PFIC as the IRS may require. Failure to file IRS Form 8621 for each applicable taxable year may result in substantial penalties and result in audit by the IRS. Further, if we are classified as a PFIC for any taxable year during which a U.S. holder owns our Class A ordinary shares, we generally would continue to be ~~less~~treated ~~attractive~~as ~~than~~a ~~investment~~PFIC inwith ~~the~~respect ~~shares~~to ofthat ~~other~~U.S. ~~corporations~~holder ~~because~~for ofall succeeding years during which such person holds our Class A ordinary shares, even if we ceased to meet the threshold requirements for PFIC status, ~~and~~unless ~~this~~the ~~perception~~U.S. holder makes a special “purging” election on IRS Form 8621. The effect of these adverse tax consequences could adversely affect ~~the~~our ~~value~~U.S. ofshareholders and make investment in our Class A ordinary shares less attractive to U.S. investors.

So long as we are classified as a PFIC, distributions made to non-corporate U.S. holders will not be eligible for taxation at reduced tax rates generally applicable to dividends paid by certain U.S. corporations and “qualified foreign corporations.” So long as we are classified as a PFIC, the more favorable rates applicable to qualifying corporate dividends could cause individuals to perceive investment in our Class A ordinary shares to be less attractive than investment in the shares of other corporations, and this perception could adversely affect the value of our Class A ordinary shares.

Whether we are a PFIC is a complex legal and factual question. We regularly review whether we expect to be classified as a PFIC in the current year or are likely to be classified as a PFIC in a future year. We may reach the conclusion in future years that we should not be classified as a PFIC.

General Risk Factors

Cybersecurity vulnerabilities, ~~or other~~ failures in information systems or risks associated with the use of artificial intelligence could result in information theft, data corruption and significant disruption of our business operations.

Cybersecurity vulnerabilities, threats, ~~computer~~and ~~viruses~~incidents, ~~and~~including ~~more~~increasingly sophisticated and targeted cyber-related attacks (such as ~~the recent increasing use of “~~ransomware” and phishing attacks), as well as cybersecurity failures resulting from human error, catastrophic events (such as fires, floods, hurricanes and tornadoes), and technological errors, pose a risk to our systems and data. An attack could result in security breaches, theft, lost or corrupted data, misappropriation of sensitive, confidential or personal data or information, loss of trade secrets and commercially valuable information, operating downtimes and operational disruptions. We attempt to mitigate these risks by employing a number of measures, including employee training, monitoring and testing, and maintenance of protective systems and contingency plans, but we have been subject to cybersecurity vulnerabilities in the past and expect to be subject to them in the future. There can be no assurance that we will be successful in preventing cybersecurity vulnerabilities or mitigating their effects. Any cyber-related attack or failure or loss of data could adversely affect our business. In addition, we may suffer reputational harm or face litigation as a result of cyber-related attacks or other data security breaches and may incur significant additional expense to implement further data protection measures.

We rely on information technology systems and networks, including cloud and third-party service providers, to process, transmit and store electronic information in connection with our business activities. These information technology systems and networks may be susceptible to damage, disruptions or shutdowns due to failures during the process of upgrading or replacing software, databases or components, power outages, hardware failures or computer viruses. If these information technology systems suffer severe damage or disruption and the issues are not resolved in a timely manner, our business, financial condition or operations could be adversely affected.

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In addition, the use of artificial intelligence-based software (including machine learning) is increasingly being used in our industry. As with many developing technologies, artificial intelligence-based software presents risks that could affect its further development, adoption, and use, and therefore our business. For example, algorithms may be flawed; data sets may be insufficient, of poor quality, or contain biased information; and inappropriate or controversial data practices by data scientists, engineers, and end-users could impair results. If artificial intelligence (“AI”) applications assist in producing deficient or inaccurate analyses, we could be subjected to competitive harm, potential legal liability or reputational harm. AI algorithms may use third-party information with unclear intellectual property rights or interests. If we do not have sufficient rights to use the data or other material or content on which any AI solutions we use rely, we may incur liability through the violation of applicable laws and regulations, third-party intellectual property, privacy or other rights, or contracts. Because AI technology itself is highly complex and rapidly developing, it is not possible to predict all of the legal, operational or technological risks that may arise relating to the use of AI.

Collaborators, other contractors or consultants in use today or in the future are vulnerable to damage or interruption from these cybersecurity vulnerabilities, other failures in information systems and artificial intelligence-based software risks. If such an event were to occur in the future and cause interruptions in their operations, it could result in a disruption of their development and commercialization programs and business operations, whether due to a loss of trade secrets or other proprietary information or other similar disruptions. To the extent that any disruption or security breach were to result in a loss of, or damage to, a counterparties’ data or applications, or inappropriate disclosure of confidential or proprietary information, our partners’ operations may be harmed and the development and commercialization of their products, development-stage product candidates and technologies could be delayed. Such an event may reduce the amount of cash flow generated by the related biopharmaceutical products and therefore adversely affect our business, financial condition and results of operations.

Changes in the application of accounting standards issued by the U.S. Financial Accounting Standards Board or other standard-setting bodies may adversely affect our financial statements.

Our financial statements are prepared in accordance with GAAP, which are periodically revised, interpreted or expanded. From time to time, we are required to adopt new or revised accounting standards issued by recognized authoritative bodies. It is possible that future accounting standards we are required to adopt may require changes to the current accounting treatment that we apply to our consolidated financial statements and may require us to make significant changes to our systems. Such changes could adversely affect our financial condition or results of operations.

The outbreak of infectious or contagious diseases could adversely affect our results of operations, financial condition and cash flows.

The outbreak of infectious or contagious diseases could severely impact global economic activity and cause significant volatility and negative pressure in financial markets. ~~Health~~Such ~~outbreaks~~events ~~and pandemics~~ could lead to quarantines, ~~mandating~~ business and school closures, travel restrictions and ~~restricting~~other ~~travel~~governmental action, oras ~~trigger~~well ~~global~~as broader economic slowdowns or ~~global~~ recessions. A health outbreak or another pandemic could adversely affect us due to, among other factors:

• a general decline in business activity;

• the destabilization of the markets could negatively impact our partners in the biopharmaceutical industry and the sales of products generating our royalties;

• difficulty accessing the capital and credit markets on favorable terms, or at all, and a severe disruption and instability in the global financial markets, or deteriorations in credit and financing conditions which could affect our access to capital necessary to fund business operations or address maturing liabilities on a timely basis;

• the potential negative impact on the health, ofavailability ~~our~~or ~~Manager’s~~productivity ~~highly~~of ~~qualified~~our ~~personnel~~employees, especially if a significant number of them are impacted;

• a deterioration in our ability to ensure business continuity during a disruption;

• interruptions, shortages, delivery delays and potential discontinuation of supply to our partners, which could (i) delay the clinical trials of the development-stage product candidates underlying our assets and result in a loss of our market share for products generating our royalties or development-stage product candidates underlying our assets, if approved, and (ii) hinder our partners’ ability to timely distribute products generating our royalties and satisfy customer demand;

• travel restrictions, shelter-in-place policies or restrictions and other disruptions, which could cause or continue to cause delays and other direct impacts at our partners’ manufacturing sites, which could impact the ability of our partners to manufacture development-stage product candidates underlying our biopharmaceutical assets and products generating our royalties; and

• potential interruptions to our partners’ clinical trial programs of development-stage product candidates underlying our biopharmaceutical assets, including: (i) the potential diversion of healthcare resources away from the conduct of clinical trials to focus on pandemic concerns; (ii) changes in hospital or research institution policies or government regulations, which could delay or adversely impact our partners’ ability to conduct their clinical trials; and (iii) pauses to or delays of trial procedures (particularly any procedures that may be deemed non-essential), patient dosing, shipment of our partners’ development-stage product candidates, distribution of clinical trial materials, study monitoring, site inspections and data analysis due to reasons related to the pandemic, each of which could cause or continue to cause a disruption or delay to the development or the approval of development-stage product candidates underlying our biopharmaceutical assets.

Legal claims and proceedings could adversely affect our business.

We may bebecome ~~subject~~involved toin a wide variety of legal claims and proceedings~~. Regardless of their merit~~, ~~these~~which ~~claims~~could ~~can~~ require significant time and expense to investigate, defend and ~~defend~~resolve and could divert management’s attention from our business. Since litigation is inherently uncertain, there is no guarantee that we will be successful in defending ~~ourselves~~ against such claims or proceedings, or ~~that~~in ~~our~~obtaining ~~assessment~~favorable ofoutcomes ~~the~~in ~~materiality~~claims ofthat ~~these~~we ~~matters,~~may ~~including~~bring. ~~any~~Our ~~reserves~~assessment ~~taken~~of inthe ~~connection~~likelihood ~~therewith,~~and ~~will~~estimated bemagnitude ~~consistent~~of ~~with~~any ~~the~~potential ~~ultimate~~gains ~~outcome~~or oflosses ~~such~~associated ~~matters.~~with ~~The~~legal ~~resolution~~claims ~~of,~~ or ~~increase~~proceedings, inincluding ~~the~~any reserves ~~taken~~established in connection ~~with~~therewith, ~~one~~is orsubject ~~more~~to ofsignificant ~~these~~judgment ~~matters~~and ~~could~~may ~~adversely~~prove ~~affect~~to ~~our~~be ~~business, financial condition or results of operations~~incorrect.

Beginning in the second quarter of 2025, we did not receive from Vertex the full amount of royalty receipts on Alyftrek net sales to which we believe that we are contractually entitled. Accordingly, we commenced the dispute resolution procedures contemplated by the agreements relating to our royalties on Vertex’s cystic fibrosis products. Any amounts receivable by us, if any, in connection with this dispute will be recognized only upon the resolution of the matter in our favor.

The resolution of, or increase in the reserves taken in connection with, one or more of these matters could adversely affect our business, financial condition or results of operations. In addition, adverse publicity or market reaction arising from legal claims or proceedings could harm our reputation, relationships with counterparties or ability to pursue future business opportunities.

Corporate responsibility matters and any related reporting obligations may impact our business.

U.S. and international regulators, investors and other stakeholders are increasingly focused on corporate responsibility matters., ~~For~~including ~~example,~~human ~~new~~capital ~~U.S.~~management, ~~and~~human ~~international~~rights, ~~laws~~sustainability and ~~regulations~~climate-related ~~relating~~matters. toThe ~~corporate~~legal ~~responsibility~~and ~~matters,~~regulatory ~~including~~landscape ~~human~~governing ~~rights~~these ~~and~~topics ~~human~~includes ~~capital management~~multiple, ~~diversity,~~potentially ~~sustainability~~overlapping ~~and~~reporting ~~climate~~regimes ~~change~~and standards, ~~are~~which ~~under~~may ~~consideration~~require orus ~~being~~to ~~adopted,~~expand ~~which~~our ~~may~~data ~~include~~collection, ~~specific~~controls, ~~target-driven~~governance, disclosure ~~requirements~~processes orand ~~obligations~~external reporting. ~~Our~~These ~~response~~developments ~~will~~could increase our compliance costs, require ~~additional~~significant ~~investments~~management time and ~~implementation~~attention ofand ~~new~~expose ~~practices~~us ~~and~~to ~~reporting~~enhanced ~~processes~~regulatory, ~~all~~litigation ~~entailing~~and ~~additional~~enforcement ~~compliance~~ risk. In addition, we have announced aseveral ~~number of~~ corporate responsibility initiatives and goals, ~~which will require ongoing investment,~~ and there is no assurance that we will achieve any of these goals or that our initiatives will achieve their intended outcomes. Perceptions of our efforts to achieve these goals often differ widely and present risks to our reputation. Any harm to our reputation resulting from our focus on corporate responsibility matters and goals or our failure or perceived failure to meet such goals could impact employee retention, the willingness of our partners to do business with us, or investors’ willingness to purchase or hold our ordinary shares, any of which could adversely affect our business, financial condition and results of operations. In addition, our ability to implement some initiatives or achieve some goals is dependent on external factors~~. For example~~, ~~our~~including ~~ability to meet certain sustainability goals or initiatives may depend in part on~~ third-party collaboration, ~~mitigation innovations~~ or the availability of economically feasible solutions.

Item 1B. UNRESOLVED STAFF COMMENTS

None.

Item 1C. CYBERSECURITY

Risk Management and Strategy

We have a dedicated team focused on cybersecurity and we maintain a cybersecurity program designed to protect our systems, technology infrastructure, operations and the data entrusted to us by our employees and counterparties. Our cybersecurity program is led by our Chief Technology Officer, who is a part of our senior leadership team and works closely with our team to develop and advance our cybersecurity strategy and regularly reports to our board of directors and the audit committee of our board of directors on cybersecurity matters.

45Cybersecurity threats are assessed as part of our enterprise risk management assessments. Our cybersecurity strategy includes procedures for identifying material cybersecurity risks, and prioritizing appropriate risk mitigations. Our cybersecurity strategy also includes developing and implementing policies, procedures, and controls, escalating issues as necessary that present a material risk, and ensuring that all employees have sufficient cybersecurity training. We have engaged consultants and other third parties in connection with our enterprise risk management assessments, including with respect to cybersecurity.

~~Cybersecurity~~We ~~threats~~conduct ~~are~~regular ~~assessed~~testing asto ~~part~~identify ofvulnerabilities ~~our~~before ~~enterprise~~they ~~risk~~can ~~management~~be ~~assessments.~~exploited ~~Our~~by ~~cybersecurity~~attackers. ~~strategy~~We ~~includes~~examine ~~procedures~~and ~~for~~validate ~~identifying~~our ~~material~~program ~~cybersecurity~~with ~~risks~~third parties, ~~prioritizing~~measuring ~~risks~~it against industry standards and ~~analyzing~~established ~~risk~~frameworks ~~mitigation.~~to ~~Our~~help ~~cybersecurity~~identify ~~strategy~~areas ~~also~~for ~~includes~~focus, ~~developing~~improvement and ~~implementing~~compliance. ~~policies~~We ~~and~~have ~~procedures,~~comprehensive ~~escalating~~incident ~~any~~response ~~issues~~plans asto ~~necessary~~ensure that ~~present~~any anon-routine ~~material~~events ~~risk~~are properly escalated and ~~ensuring~~addressed. ~~that~~These ~~all~~plans ~~employees~~are ~~have~~validated ~~sufficient~~through ~~cybersecurity~~cyber ~~training.~~incident Weexercises ~~have~~to ~~engaged~~consider ~~consultants~~the ~~and~~types ~~other~~of ~~third~~decisions ~~parties~~that would need to be made in ~~connection~~the ~~with~~event ~~our~~of ~~enterprise~~a ~~risk~~cyber ~~management~~incident. ~~assessments,~~We ~~including~~have ~~with~~engaged ~~respect~~in toscenario planning exercises around cyber incidents with cybersecurity consultants in this process.

WeOur ~~conduct~~security ~~regular~~awareness ~~testing~~program toutilizes ~~identify~~simulations ~~vulnerabilities~~of ~~before~~attacks ~~they~~coupled ~~can~~with beemployee ~~exploited~~training byin ~~attackers.~~order Weto ~~examine~~reduce ~~and~~risks ~~validate~~to our ~~program~~systems ~~with~~if ~~third~~they ~~parties,~~are ~~measuring~~the ittarget ~~against~~of ~~industry~~phishing ~~standards~~or ~~and~~social ~~established~~engineering. ~~frameworks~~We toassess ~~help~~third ~~identify~~party ~~areas~~vendors ~~for~~who ~~focus, improvement and compliance. We~~ have ~~comprehensive~~access ~~plans~~ to ~~ensure~~our ~~that~~data ~~any~~or ~~non-routine~~systems ~~events are properly escalated. These plans are validated through cyber incident exercises~~ to ~~consider~~measure ~~the~~their ~~types~~adherence ~~of decisions that would need~~ to berelevant ~~made~~industry inpractices ~~the~~and ~~event~~standards, ofincluding adue ~~cyber~~diligence ~~incident.~~and Wemonitoring ~~have~~compliance ~~engaged in scenario planning exercises around cyber incidents~~ with ~~cybersecurity~~security ~~consultants in this process~~assessments.

~~Our~~In ~~security~~2025, ~~awareness~~2024 ~~platform~~and ~~aims~~2023, towe ~~reduce~~did ~~vulnerabilities~~not inidentify ~~our~~any ~~systems~~risks iffrom ~~they~~cybersecurity ~~are~~threats, ~~the~~including ~~target~~as a result of ~~phishing~~any previous cybersecurity incidents, that have materially affected or ~~social~~are ~~engineering~~reasonably ~~through~~likely ~~simulations~~to ofmaterially ~~attacks~~affect ~~coupled~~us, ~~with~~including ~~employee~~our ~~training~~business strategy, results of operations or financial condition. WeDespite ~~assess~~our ~~third~~efforts, ~~party~~we ~~vendors~~cannot ~~who~~eliminate ~~have~~all ~~access~~risks tofrom ~~our~~cybersecurity ~~data~~threats, or ~~systems~~provide toassurance ~~measure~~that ~~their~~we ~~adherence~~have tonot ~~relevant~~experienced ~~industry~~an ~~practices~~undetected ~~and~~cybersecurity ~~standards~~incident. For more information about these risks, ~~including~~please ~~due~~see ~~diligence~~“Risk ~~and~~Factors—Cybersecurity ~~monitoring~~vulnerabilities, ~~compliance~~failures in information systems or risks associated with ~~security~~the ~~assessments~~use of artificial intelligence could result in information theft, data corruption and significant disruption of our business operations.”

In 2024 and 2023, we did not identify any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition. Despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurance that we have not experienced an undetected cybersecurity incident. For more information about these risks, please see “Risk Factors—Cybersecurity vulnerabilities or other failures in information systems could result in information theft, data corruption and significant disruption of our business operations.”

Governance

The board of directors has adopted a Cyber Security and Personal Data Breach Policy in order to reflect the importance of appropriate security, processes and procedures to the protection of data and assets, and in an effort to establish a foundation for successful protection against cyber-crime and to minimize any potential negative impacts of a successful cyber-attack. Our cybersecurity program is overseen by our Chief Technology Officer who reports directly to our Chief Executive Officer and periodically briefs the audit committee and the board of directors on our cybersecurity program and cybersecurity issues. Our Chief Technology Officer has over 25 years of professional experience in various roles across multiple industries involving leading strategic technology initiatives. Several of our directors have experience with managing and mitigating cybersecurity and technology risks, which provides our board of directors with insight into such risks and aid in overseeing our information security, operations and systems, as well as our continuing investment in and development of our cybersecurity program. The board of directors receives updates or training, as necessary, on cybersecurity issues from management, experts and legal advisors, as required. The audit committee is responsible for overseeing our enterprise risk management program, which includes consideration of technology and cybersecurity risks. The audit committee receives updates about the results of assessments conducted by outside advisors who provide independent assessments of our technology systems.

Item 2. PROPERTIES

Our executive offices are located at 110 East 59th Street, New York, NY 10022~~, and are provided by the Manager~~. We believe that our office facilities are suitable and adequate for our business as it is contemplated to be conducted.

Item 3. LEGAL PROCEEDINGS

From time to time, we may be a party to various claims, charges and litigation matters arising in the ordinary course of business. Management and legal counsel regularly review the probable outcome of such proceedings. While we cannot feasibly predict the outcome of these matters with certainty, we believe, based on examination of these matters, experience to date and discussions with counsel, that the ultimate liability, individually or in the aggregate, will not adversely affect our business, financial condition or results of operations.

Item 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II.

Item 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our Class A ordinary shares are traded under the symbol “RPRX” on the Nasdaq Global Select Market. Our Class B ordinary shares are not listed on any stock exchange nor traded on any public market. As of February 76, ~~2025~~2026, there were 2 shareholders of record of our Class A ordinary shares and 25 shareholders of record of our Class B ordinary shares. The number of record holders does not include persons who held our Class A ordinary shares in nominee or “street name” accounts through brokers or other institutions on behalf of shareholders.

Use of Proceeds

None.

Dividends

In ~~2024~~2025, we declared and paid four quarterly cash dividends of $0.2122 per Class A ordinary share for an aggregate amount of $~~376~~378.53 million to holders of our Class A ordinary shares. Future dividends are subject to declaration by the board of directors. To the extent approved and payable, we intend to pay dividends on or about March 10, June 10, September 10 and December 10 to holders of record on or about the twentieth day of each such prior month.

Securities Authorized for Issuance Under Equity Compensation Plans

See Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” for information regarding securities authorized for issuance.

Stock Performance Graph

The graph below compares the cumulative total stockholder return, calculated on a dividend-reinvested basis, on our Class A ordinary shares, the Standard & Poor’s 500 Index (“S&P 500”) and the Nasdaq Composite Index (“Nasdaq Composite”). The graph assumes an initial investment of $100 in our Class A ordinary shares at the market close on ~~June~~December 1631, 2020, which was our initial trading day and its relative performance is tracked through December 31, ~~2024~~2025. The comparisons in the graph below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our Class A ordinary shares.

Comparison of Cumulative Total Returns_v3.gif

The above performance graph shall not be deemed soliciting material or to be filed with the SEC for purposes of Section 18 of the Exchange Act, nor shall such information be incorporated by reference into any of our other filings under the Exchange Act or the Securities Act.

Recent Sales of Unregistered Securities

None.

Issuer Purchases of Equity Securities

Share repurchase activities of our Class A ordinary shares during the fourth quarter of ~~2024~~2025 are as follows (in thousands, except per share amounts):

Periods	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Program	Maximum Dollar Value of Shares that May Yet Be Purchased Under the Program(1)
October 1, 2024 - October 31, 2024	1,662	$	27.81	1,662	$	469,356
October 1, 2025 - October 31, 2025	1,784	$	36.59	1,784	$	1,793,008
November 1, 2024 - November 30, 2024	147	27.35		147	465,335
November 1, 2025 - November 30, 2025	260	38.66		260	1,782,965
December 1, 2024 - December 31, 2024	—	—		—	465,335
December 1, 2025 - December 31, 2025	—	—		—	1,782,965
Total	12,~~809~~044	2736.7885		12,~~809~~044

(1)On ~~March~~January 2710, ~~2023~~2025, ~~we announced~~ our board of directors authorized a new share repurchase program under which we may repurchase up to $13.0 billion of our Class A ordinary shares. ~~The~~This new share repurchase program ~~expires~~replaces the unused capacity under the previous share repurchase program that was announced on ~~June~~March 2327, 2023. The new share repurchase program has been approved by our board of directors through June 2027 and shareholders have approved the terms of our share repurchase contracts and counterparties thereto through May 2030. The share repurchase program does not obligate us to acquire a minimum amount of our Class A ordinary shares. Under the share repurchase program, Class A ordinary shares may be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act. The maximum dollar value of shares that may yet be purchased under the program represents the remaining amount available under the new share repurchase program.

4844

Item 6. [Reserved]

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help the reader understand our results of operations, cash flows, other changes in financial condition and business performance. MD&A is provided as a supplement to, and should be read in conjunction with, our audited consolidated financial statements and the accompanying notes to our consolidated financial statements included in our Annual Report on Form 10-K. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Special Note Regarding Forward-Looking Statements and the section titled “Risk Factors” in Part I, Item 1A.

Royalty Pharma plc is a public limited company ~~that was~~ incorporated under the laws of England and Wales ~~to facilitate our initial public offering (“IPO”) in 2020~~. “Royalty Pharma,” the “Company,” “we,” “us” and “our” refer to Royalty Pharma plc and its subsidiaries on a consolidated basis. Our principal asset is a controlling equity interest in Royalty Pharma Holdings Ltd (“RP Holdings”), a private limited company incorporated under the laws of England and Wales. We conduct our business through RP Holdings and its subsidiaries.

Business Overview

Background and Format of Presentation

WeRP ~~consummated~~Holdings anis ~~exchange~~owned ~~offer~~by onRoyalty ~~February~~Pharma 11plc and, ~~2020~~indirectly, by various partnerships (the “~~Exchange~~Continuing ~~Offer~~Investors Partnerships”) toand, ~~facilitate~~in ~~our~~addition, ~~IPO.~~post-Internalization ~~Through~~(as defined below), by the ~~Exchange~~Holders ~~Offer,~~of ~~investors~~RP ~~which~~Holdings ~~represented~~Class ~~82%~~E ofInterests ~~the~~(as ~~aggregate~~defined ~~limited~~below). ~~partnership~~RP ~~interests~~Holdings inis the ~~various~~sole ~~partnerships~~owner ~~(the~~of Royalty Pharma Investments 2019 ICAV (“~~Legacy~~RPI ~~Investors~~2019 ~~Partnerships~~ICAV”), ~~that~~which ~~owned~~is an Irish collective asset management vehicle and is the successor to Royalty Pharma Investments, an Irish unit trust. ~~(“Old~~In ~~RPI”)~~2022, ~~exchanged~~we ~~their~~became ~~limited~~an ~~partnership~~indirect ~~interests~~owner of an 82% economic interest in ~~the~~Royalty ~~Legacy~~Pharma ~~Investors~~Investments ~~Partnerships~~ICAV, ~~for~~which ~~limited~~was ~~partnership~~previously ~~interests~~owned indirectly ~~RPI~~by USRoyalty ~~Partners~~Pharma ~~2019,~~Investments. ~~LP,~~In aconnection ~~Delaware~~with ~~limited~~the ~~partnership~~Internalization, orRoyalty ~~RPI~~Pharma ~~International~~Investments ~~Holdings~~distributed ~~2019,~~all ~~LP,~~of aits ~~Cayman~~assets ~~Islands~~to ~~exempted~~Royalty ~~limited~~Pharma ~~partnership~~Investments 2011 ICAV (together, ~~the~~with ~~“Continuing~~Royalty ~~Investors~~Pharma ~~Partnerships~~Investments ICAV, “Old RPI”).

We ~~operate~~consummated ~~and~~an ~~control~~exchange offer on February 11, 2020 (the ~~business~~“Exchange ~~affairs~~Offer”) ofto facilitate our initial public offering (“IPO”). Prior to the Exchange Offer, Royalty Pharma ~~Holdings~~Investments ~~Ltd~~was owned by various partnerships (the “RPLegacy ~~Holdings~~Investors Partnerships”). WeThrough ~~include~~the RPExchange ~~Holdings~~Offer, ~~and~~investors ~~its~~which ~~subsidiaries~~represented 82% of the aggregate limited partnership in ~~our~~the ~~consolidated~~Legacy ~~financial~~Investors ~~statements.~~Partnerships RPexchanged their limited partnership interests in the Legacy Investors Partnerships for limited partnership interests in RPI US Partners 2019, LP and RPI International Holdings is2019, LP, which are part of the ~~sole~~Continuing Investors Partnerships. Following the Exchange Offer, we became the indirect owner of an 82% economic interest in Royalty Pharma Investments ~~2019~~which ~~ICAV~~entitled (“us to 82% of the economics of its wholly-owned subsidiary RPI ~~2019~~Finance ~~ICAV~~Trust, a Delaware statutory trust (“RPIFT”) and 66% of Royalty Pharma Collection Trust, ~~which~~a isDelaware anstatutory ~~Irish~~trust ~~collective~~(“RPCT”). ~~asset~~In ~~management~~December ~~vehicle~~2023, ~~and~~we isacquired the ~~successor~~remaining to34% ~~Old~~interest ~~RPI~~in RPCT owned by Royalty Pharma Select Finance Trust, a Delaware statutory trust (“RPSFT”).

~~Following~~Prior ~~the~~to ~~Exchange Offer~~Internalization, we ~~became~~were ~~the~~externally ~~indirect~~managed ~~owner~~by ofRP anManagement, ~~82% economic interest in Old RPI through our subsidiary RPI 2019 Intermediate Finance Trust~~LLC, a Delaware ~~statutory~~limited ~~trust.~~liability Wecompany ~~are entitled to 82% of~~ (the ~~economics~~“Legacy ofManager” ~~Old~~or ~~RPI’s wholly-owned subsidiary RPI Finance Trust, a Delaware statutory trust (~~“~~RPIFT~~RPM”), ~~and~~pursuant ~~66%~~to ofadvisory ~~Royalty~~and ~~Pharma~~management ~~Collection~~agreements ~~Trust~~(collectively, athe ~~Delaware~~“Legacy ~~statutory~~Management ~~trust (“RPCT~~Agreement”).

~~In 2022, we became an indirect owner of an 82% economic interest in Royalty Pharma Investments ICAV (“RPI ICAV”), which was previously owned directly by Old RPI.~~45

49On January 10, 2025, we entered into an agreement (as amended, the “Purchase Agreement”) with RPM, Royalty Pharma Manager, LLC, a Delaware limited liability company (“RP Manager”) and the sellers named therein (the “Sellers”). Pursuant to the Purchase Agreement, RPM contributed substantially all of its assets and liabilities to RP Manager and we agreed to acquire all of the equity interests of RP Manager from the Sellers (the “Internalization”). The Sellers included our founder, chief executive officer and chairman, Pablo Legorreta, RPM I, LLC and RP MIP Holdings, LLC (“RP MIP Holdings”). The equity interest holders of RP MIP Holdings include our named executive officers and certain employees of the Legacy Manager, who became employees of Royalty Pharma, LLC, a wholly-owned subsidiary of RP Holdings, in connection with the Internalization. We completed the acquisition of RP Manager on May 16, 2025.

In December 2023, RPI 2019 ICAV acquired the remaining interest in RPCT owned by Royalty Pharma Select Finance Trust, a Delaware statutory trust (“RPSFT”), at which time RPSFT ceased to hold a non-controlling interest in RPCT. Prior to December 2023, the remaining 34% of RPCT was owned by the Legacy Investors Partnerships and RPSFT, which was wholly owned by Royalty Pharma Select, an Irish unit trust.

In January 2025, we agreed to acquire our Manager for an aggregate consideration of approximately $1.1 billion (the “Internalization”). The consideration consists of approximately 24.5 million of RP Holdings shares, $380 million of existing debt of the Manager and $200 million of cash less the amount of the Operating and Personnel Payments (as defined below) made to the Manager from January 1, 2025 through the closing of the transaction. The acquisition is expected to reduce costs and enhance economic returns on investments. Additionally, we expect the acquisition to increase shareholder alignment, enhance corporate governance, ensure management continuity and simplify our corporate structure. If the acquisition is approved by shareholders, we would cease to be externally managed and would operate as an integrated company with all employees of the Manager becoming employees of the Company. The closing of the transaction is subject to the shareholders’ approval of the issuance of the share consideration and other customary closing conditions, including required regulatory approvals. The transaction is estimated to close during the second quarter of 2025.

Understanding Our Financial Reporting

Our portfolio of investments contains royalties and royalty-like terms held through different forms or instruments. Most of the royalties we acquire are treated as investments in cash flow streams and are classified as financial assets measured under the effective interest method in accordance with generally accepted accounting principles in the United States (“GAAP”). Under this accounting methodology, we calculate the effective interest rate on each financial royalty asset using a forecast of the expected cash flows to be received over the life of the financial royalty asset relative to the initial acquisition price. The yield, which is calculated at the end of each reporting period and applied prospectively, is then recognized via accretion into our income at the effective rate of return over the expected life of the financial royalty asset.

The measurement of income from our financial royalty assets requires significant judgments and estimates, including management’s judgment in forecasting the expected future cash flows of the underlying royalties and the expected duration of each financial royalty asset. Our cash flow forecasts are updated each reporting period primarily using sell-side equity research analysts’ consensus sales estimates. We then calculate our expected royalty receipts by applying our royalty terms to these consensus sales forecasts. As we update our forecasted cash flows on a periodic basis and recalculate the present value of the remaining future cash flows, any shortfall when compared to the carrying value of the financial royalty asset is recorded directly in the consolidated statements of operations as non-cash provision expense. If, in a subsequent period, there is an increase in expected cash flows or if actual cash flows are greater than cash flows previously expected, we reverse the provision expense previously recorded in part or in full by recording a non-cash credit to the provision, or provision income.

As a result of the non-cash charges associated with applying the effective interest method accounting methodology to our financial royalty assets, our consolidated statements of operations activity can be volatile and unpredictable. Small declines in sell-side equity research analysts’ consensus sales forecasts over a long time horizon can result in an immediate non-cash income statement expense recognition, even though the applicable cash inflows will not be realized for many years into the future. For example, in late 2014 we acquired the cystic fibrosis franchise and shortly after, declines in near-term sales forecasts of sell-side equity research analysts caused us to recognize non-cash provision expense in our consolidated statements of operations. Over the course of the next 10 quarters, we continued to recognize non-cash provision expense because of these changes in sales forecasts, ultimately reaching a peak cumulative allowance of $1.30 billion by September 30, 2017. With the approval of Vertex’s Trikafta in October 2019, sell-side equity research analysts’ consensus sales forecasts increased to reflect the larger addressable market and the extension of the expected duration of the Trikafta royalty, resulting in the reversal of the remaining $1.10 billion cumulative allowance. The recognition of the associated non-cash provision income of $1.10 billion in 2019 was not tied to royalty receipts, but rather to the increase in sales forecasts due to the U.S. Food and Drug Administration (“FDA”) approval of Trikafta. This example illustrates the volatility caused by our accounting model in our consolidated statements of operations.

We believe there is no direct correlation between income from financial royalty assets and royalty receipts due to the nature of the accounting methodology applied for financial royalty assets. Further, income from financial royalty assets and the provision for changes in expected cash flows related to these financial royalty assets can be volatile and unpredictable.

Our operations have historically been financed primarily with cash flows generated by our royalties. Given the importance of cash flows and their predictability to management’s operation of the business, management uses Portfolio Receipts (as defined below) as a primary measure of our operating performance. See “—Portfolio Overview” for additional discussion regarding Portfolio Receipts.

Understanding Our Results of Operations

We report non-controlling interests related to the portion of ownership interests of consolidated subsidiaries not owned by us and which are attributable to:

1. The Legacy Investors Partnerships’ ownership of approximately 18% ofin Old RPI, ~~and~~which ~~RPI~~is ~~ICAV~~the only remaining historical non-controlling interest that existed prior to our IPO. The value of this non-controlling interest will continue to decline over time as the assets in Old RPI ~~and~~expire. ~~RPI~~The ~~ICAV~~Legacy ~~expire~~Investors Partnerships are referred to as the “legacy non-controlling interests.”

2. AThe deContinuing ~~minimis~~Investors ~~interest~~Partnerships’ indirect ownership in ~~RPCT~~RP ~~held~~Holdings bythrough ~~RPSFT.~~their Inindirect ~~December~~ownership ~~2023,~~of weRP ~~acquired~~Holdings’ Class B ordinary shares (the ~~remaining~~“RP ~~interest~~Holdings inClass ~~RPCT~~B ~~owned~~Interests”). byRP ~~RPSFT~~Holdings Class B Interests are exchangeable into our Class A ordinary shares. As the Continuing Investors Partnerships conduct exchanges, atthe ~~which~~Continuing ~~time~~Investors ~~RPSFT~~Partnerships’ ~~ceased~~indirect toownership ~~hold~~in aRP Holdings decreases and the value of this non-controlling interest ~~in RPCT~~decreases.

~~The~~3. ~~Legacy~~Pablo ~~Investors~~Legorreta’s ~~Partnership~~ultimate ~~together~~ownership ~~with~~of ~~RPSFT~~the ~~are~~RP ~~referred~~Holdings’ toClass asC ordinary share (the “~~legacy~~RP ~~non-controlling~~Holdings ~~interests.”~~Class ~~The~~C ~~legacy~~Special ~~non-controlling~~Interest”) ~~interests~~which ~~are~~entitles ~~the~~him ~~only~~to ~~historical~~receive ~~non-controlling~~Equity ~~interests~~Performance ~~that~~Awards ~~existed~~(“Founder’s ~~prior to our IPO~~Equity”).

~~Additionally~~Equity Performance Awards (“EPAs”) represent 20% of the Net Economic Profit (as defined below) generated from investments made during each two-year investment period (each, ~~following~~a “Portfolio”). Net Economic Profit is defined as the ~~consummation~~aggregate ofcash ~~our~~receipts ~~IPO~~for all new portfolio investments in a Portfolio less Total Expenses, wewhich ~~also~~is ~~report~~defined ~~non-controlling~~as ~~interests~~interest expense, operating expense and recovery of acquisition cost related to: that Portfolio. Distributions of EPAs occur only upon the satisfaction of specified performance and return thresholds. EPAs are generally settled in RP Holdings’ Class B Interests, which are immediately exchanged upon issuance for Class A ordinary shares. A portion of the EPAs may be paid in cash as a tax advance to cover income tax obligations incurred by the beneficial owners of the RP Holdings Class C Special Interest.

3Mr. ~~The~~Legorreta ~~Continuing~~granted ~~Investors Partnerships’~~ ownership units in RPthe ~~Holdings~~entities ~~through~~that ~~their~~hold ~~ownership~~the of RP Holdings Class BC ~~Interests~~Special ~~was~~Interest ~~approximately~~to ~~24%~~certain asemployees of ~~December 31~~RPM, ~~2024.~~who RPbecame ~~Holdings~~employees ~~Class~~of BRoyalty ~~Interests~~Pharma, ~~are~~LLC, ~~exchangeable~~a ~~into~~wholly-owned ~~our~~subsidiary ~~Class~~of ARP ~~ordinary~~Holdings, ~~shares.~~in Asconnection with the ~~Continuing~~Internalization. ~~Investors~~These ~~Partnerships~~grants ~~conduct~~allow ~~exchanges,~~such ~~the~~employees ~~Continuing~~to ~~Investors~~participate ~~Partnerships’~~on ~~ownership~~a inpro RPrata ~~Holdings~~basis ~~decreases~~in ~~and~~ the ~~value~~economic returns of ~~this~~the ~~non-controlling~~EPAs ~~interest~~for ~~decreases.~~a ~~Additionally,~~specific RPPortfolio ~~Holdings~~(the ~~began~~“Employee toEPAs”). ~~retire~~Prior RPto ~~Holdings~~the ~~Class~~Internalization, AFounder’s ~~Interests~~Equity, ~~held~~which byincluded usthe inEmployee ~~connection~~EPAs, ~~with~~was ~~our~~accounted ~~repurchase~~for ofas ~~our~~an ~~Class~~equity Atransaction ~~ordinary~~and ~~shares.~~recorded Asas RPnon-controlling ~~Holdings~~interest. ~~retires~~Following RPthe ~~Holdings~~Internalization, ~~Class~~Founder’s ~~A Interests~~Equity, ~~our~~which ~~ownership~~no inlonger RPincludes ~~Holdings~~Employee ~~decreases~~EPAs, ~~and~~continues ~~the~~to ~~value~~be ofaccounted ~~this~~as non-controlling interest ~~increases~~.

4. The ~~Continuing~~Sellers’ ~~Investors~~indirect ~~Partnerships~~ownership ~~are~~in ~~referred~~RP Holdings through their indirect ownership of RP Holdings’ Class E ordinary shares (the “RP Holdings Class E Interests”). In connection with the Internalization, we issued 24.5 million RP Holdings Class E Interests, subject to asvesting conditions, to the Sellers (the “~~continuing~~Holders of RP Holdings Class E Interests”) as part of the transaction considerations. Upon vesting, the RP Holdings Class E Interests become exchangeable on a one-for-one basis for Class A ordinary shares, and upon such exchange, the value of this non-controlling ~~interests~~interest decreases.”

4.The ~~RPI~~Continuing ~~EPA~~Investors ~~Vehicle~~Partnerships, ~~LLC~~the Founder’s ~~(“EPA~~Equity ~~Vehicle”)~~and ~~ownership~~the Holders of RP Holdings’ Class CE ~~ordinary~~Interests, ~~share~~collectively, ~~(the~~are ~~“RP~~referred ~~Holdings~~to ~~Class~~as Cthe ~~Special~~“continuing ~~Interest”)~~non-controlling interests.”

EPA Vehicle is entitled to receive equity distributions through its RP Holdings Class C Special Interest (“Equity Performance Awards”). Equity Performance Awards owed to EPA Vehicle will be recognized as an equity transaction when the obligation becomes due and will impact the income allocated to non-controlling interest related to the RP Holdings Class C Special Interest. The Equity Performance Awards will be payable in RP Holdings Class B Interests that will be exchanged upon issuance for Class A ordinary shares. EPA Vehicle may also receive a periodic cash advance in respect of the RP Holdings Class C Special Interest to the extent necessary for EPA Vehicle or any of its beneficial owners to pay when due any income tax imposed on it or them as a result of holding such RP Holdings Class C Special Interest. We expect the Equity Performance Awards to be payable in 2025 once certain performance conditions are met.

Total income and other revenues

Total income and other revenues is primarily comprised of interest income from our financial royalty assets and royalty income generally arising from successful commercialization of products developed through research and development (“R&D”) funding arrangements. Most of our royalties are classified as financial assets as our ownership rights are generally ~~protective and~~ passive in nature. In certain instances, we may acquire a royalty that includes more substantial rights or ownership of the underlying intellectual property, we classify such royalties as intangible assets and recognize revenue from these intangible royalty assets.

5147

The royalty payors that accounted for greater than 10% of our total income and other revenues are shown in the table below:

Years Ended December 31,

Year ended December 31,

Royalty Payor

Royalty

~~2024~~2025

~~2023~~2024

Vertex

Cystic fibrosis franchise

3635

Roche

Evrysdi, Mircera

10*

*10

*Represents less than 10%.

Income from financial royalty assets

Our financial royalty assets represent investments in cash flow streams with yield components that most closely resemble loans measured at amortized cost under the effective interest method. We calculate the effective interest rate using forecasted expected cash flows to be received over the life of the royalty asset relative to the initial acquisition price. Interest income is recognized at the effective rate of return over the expected life of the asset, which is calculated at the end of each reporting period and applied prospectively. As changes in sell-side equity research analysts’ consensus sales estimates are updated on a quarterly basis, the effective rate of return changes. For example, if sell-side equity research analysts’ consensus sales forecasts increase, the yield to derive income on a financial royalty asset will increase and result in higher income for subsequent periods.

Variables affecting the recognition of interest income from financial royalty assets under the prospective effective interest method include any one of the following: (1) additional acquisitions, (2) changes in expected cash flows of the underlying pharmaceutical products, derived primarily from sell-side equity research analysts’ consensus sales forecasts, (3) regulatory approval of additional indications which leads to new cash flow streams, (4) changes to the estimated duration of the royalty (e.g., patent expiration date), (5) changes in amounts and timing of projected royalty receipts and milestone payments and (6) changes in the portion of sales that are subject to the royalty, which is referred to as royalty bearing sales. Our financial royalty assets are directly linked to sales of underlying pharmaceutical products whose life cycle typically peaks at a point in time, followed frequently by declining sales trends due to the entry of generic competition, resulting in natural declines in the asset balance and periodic interest income over the life of our royalties. The recognition of interest income from royalties requires management to make estimates and assumptions around many factors, including those impacting the variables noted above.

Other royalty income and revenues

Other royalty income and revenues primarily includes income from financial royalty assets that have been fully amortized and income from synthetic royalties and milestones arising out of R&D funding arrangements. Occasionally, a royalty asset may be amortized on an accelerated basis due to collectability concerns, which, if resolved, may result in future cash collections when no financial royalty asset remains. Similarly, we may continue to collect royalties on a fully amortized financial royalty asset beyond the estimated duration. In each scenario where a financial royalty asset has been fully amortized, income from such royalty is recognized as Other royalty income and revenues.

Other royalty income and revenues also includes revenues from intangible royalty assets and income from royalties that are recorded at fair value.

Provision for changes in expected cash flows from financial royalty assets

The Provision for changes in expected cash flows from financial royalty assets includes the following:

•non-cash expense or income related to the current period activity resulting from adjustments to the cumulative allowance for changes in expected cash flows; and

•non-cash expense or income related to the provision for current expected credit losses, which reflects the activity for the period, primarily due to new financial royalty assets with limited protective rights and changes to cash flow estimates for financial royalty assets with limited protective rights.

As discussed above, income is accreted on our financial royalty assets using the effective interest method. As we update our forecasted cash flows on a periodic basis and recalculate the present value of the remaining future cash flows, any shortfall when compared to the carrying value of the financial royalty asset is recorded directly in the consolidated statements of operations through the line item Provision for changes in expected cash flows from financial royalty assets. If, in a subsequent period, there is an increase in expected cash flows or if actual cash flows are greater than cash flows previously expected, we reverse the provision expense previously recorded in part or in full by recording a credit to the provision, or provision income.

The same variables and management’s estimates affecting the recognition of interest income on our financial royalty assets noted above also directly impact the provision.

Provision for credit losses on unfunded commitments

The provision for credit losses on unfunded commitments, a non-cash item, represents the current expected credit losses on the unfunded portions of our funding arrangements with Revolution Medicines. Because we have limited protective rights with respect to each unfunded portion once the committed funding is provided, we are required to recognize an allowance for current expected credit losses based on our estimate of probability of future funding. We estimate this allowance using the probability of default and loss given default method. We are required to reassess our estimate of current expected credit losses as of each reporting date, and any subsequent change to such allowance, which can be income or expense, is reflected within Provision for credit losses on unfunded commitments in the consolidated statements of operations.

R&D funding expense

R&D funding expense consists of certain development-stage funding payments that we have made to counterparties to acquire royalties or milestones on product candidates. ItThe ~~includes development-stage funding~~ payments tocan ~~counterparties~~be ~~that~~made ~~are~~on ~~made~~an upfront orbasis, upon pre-approval milestones, ~~and~~or ~~development-stage funding payments that are made to counterparties~~ over time as the related product candidates undergo clinical trials ~~with our counterparties~~.

General and administrative expenses

~~General~~Prior to the Internalization, the most significant component of general and administrative (“G&A”) expenses ~~include~~was ~~primarily~~the ~~Operating~~Management ~~and~~Fees ~~Personnel Payments~~ (as defined below),. ~~legal~~Under ~~expenses~~the Legacy Management Agreement, ~~other~~we ~~expenses~~paid ~~for~~a ~~professional~~quarterly ~~services~~operating and ~~share-based~~personnel ~~compensation~~payment to RPM or its affiliates equal to 6.5% ~~The~~of ~~expenses~~the ~~incurred~~cash receipts from Royalty Investments (as defined in ~~respect~~the ofLegacy ~~Operating~~Management Agreement) and ~~Personnel~~0.25% ~~Payments~~of ~~comprise~~ the ~~most~~value ~~significant~~of ~~component~~our security investments under GAAP as of ~~G&A~~the ~~expenses~~end of such quarter (“Management Fees”).

~~Under~~Following the ~~Management Agreement~~Internalization, we no longer pay aManagement ~~quarterly~~Fees; ~~operating~~instead, ~~and~~employee ~~personnel~~compensation ~~payment~~expenses torepresent the ~~Manager~~most orsignificant ~~its~~component ~~affiliates~~of ~~(“Operating~~G&A ~~and Personnel Payments”) equal to 6~~expenses.5% ofEmployee ~~the~~compensation includes cash-based ~~receipts~~and ~~from~~share-based ~~Royalty~~expenses. ~~Investments~~Share-based ~~(as~~compensation ~~defined~~expenses inarising ~~the~~from ~~Management Agreement), or Portfolio Receipts for such quarter, and 0.25% of~~ the ~~value~~Internalization ofprimarily ~~our~~include ~~security investments under GAAP as of~~ the ~~end of such quarter.~~ following:

~~The~~1.Approximately ~~operating~~22.8 million ~~and~~RP ~~personnel~~Holdings ~~payments~~Class ~~for~~E ~~Old~~Interests ~~RPI,~~with an ~~obligation~~aggregate offair ~~the~~value ~~Legacy~~of ~~Investors~~approximately ~~Partnerships~~$755.4 million, aswhich aare ~~non-controlling~~expensed ~~interest~~over investing ~~Old~~periods ~~RPI~~on ~~and~~a ~~for~~straight-line ~~which~~basis ~~the~~of ~~expense~~generally isfive ~~reflected~~to innine ~~G&A~~years. ~~expenses,~~As ~~are~~of ~~calculated~~December as31, ~~the~~2025, ~~greater~~we ofhad $1646.5 million ~~per~~of ~~quarter~~unrecognized ~~and~~compensation ~~0.3125%~~expense ofrelated ~~royalties~~to ~~from~~19.5 ~~Royalty~~million ~~Investments~~RP ~~(as~~Holdings ~~defined~~Class inE ~~the~~Interests ~~limited~~that ~~partnership~~is ~~agreements~~expected ofto ~~the~~vest ~~Legacy~~over ~~Investors~~a ~~Partnerships)~~weighted ~~during~~average ~~the~~period ~~previous~~of ~~twelve calendar months~~5.5 years.

In2.The ~~January~~vesting ~~2025,~~of wethe ~~agreed~~Employee toEPAs ~~acquire~~over ~~our~~their ~~Manager~~remaining ~~for~~service anperiods ~~aggregate~~and ~~consideration~~the ofsubsequent ~~$1.1~~change ~~billion~~in their fair value. The ~~transaction~~fair isvalue ~~estimated~~of tothe ~~close~~Employee ~~during~~EPAs ~~the~~is ~~second~~driven ~~quarter~~by the performance of ~~2025.~~the ~~Upon~~investments ~~closing~~within ofthe ~~this~~Portfolio ~~transaction,~~and wewill ~~would~~fluctuate nobased ~~longer~~on ~~make~~the ~~Operating~~timing and ~~Personnel~~amount ~~Payments~~of toinvestments ~~the~~made ~~Manager.~~during ~~Following~~ the ~~acquisition,~~investment ~~personnel~~period ~~costs~~as ~~will~~well ~~comprise~~as the ~~most~~actual ~~significant~~and ~~component~~expected ofreturns ~~G&A~~on ~~expenses~~the investments.

53Additionally, as each new Portfolio commences after the Internalization, any related Employee EPAs will also be recognized as share-based compensation expense over the required service periods of generally four years and included within General and administrative expenses in the consolidated statement of operations. Lastly, G&A expenses include rent, legal fees and other expenses for professional services.

~~Equity in (earnings)/losses of equity method investees~~ 49

Equity in (earnings~~)/losses~~ of equity method investees ~~primarily includes the results of our share of income or loss from the following non-consolidated affiliates:~~

Equity in earnings of equity method investees primarily includes the results of our share of income or loss from the following non-consolidated affiliates:

1.Legacy SLP Interest. In connection with the Exchange Offer, we acquired an equity method investment from the Continuing Investors Partnerships in the form of a special limited partnership interest in the Legacy Investors Partnerships (the “Legacy SLP Interest”) in exchange for issuing shares in our subsidiary. The Legacy SLP Interest entitles us to the equivalent of performance distribution payments that would have been paid to the general partner of the Legacy Investors Partnerships and a performance income allocation on a similar basis. As the Legacy Investors Partnerships no longer participate in investment opportunities, the value of the Legacy SLP Interest is expected to decline over time.

2.The Avillion Entities. The Avillion Entities (as defined below) partner with global biopharmaceutical companies to perform R&D in exchange for success-based milestones or royalties if products are commercialized. Our investments in Avillion Financing I, LP (“Avillion I”) and BAv Financing II, LP (“Avillion II” and together with Avillion I, the “Avillion Entities”) are accounted for using the equity method.

Other income, net

Other income, net primarily includes the changes in fair ~~market~~ value of our equity securities, ~~derivative instruments~~ and available for sale debt securities, including related forwards and funding commitments, and interest income.

Net income attributable to non-controlling interests

The net income attributable to non-controlling interests includes income attributable to the legacy non-controlling interests and the continuing non-controlling interests. Following our acquisition of the remaining non-controlling interest in RPCT held by RPSFT in December 2023, and since the Legacy Investors Partnerships no longer participate in investment opportunities, the related net income attributable to the legacy non-controlling interests is expected to continue to decline over time as the assets held by Old RPI ~~and RPI ICAV~~ mature. The net income attributable to the continuing non-controlling interests includes RP Holdings Class B Interests held by the Continuing Investors Partnerships for which the related future net income will decline over time if the investors who indirectly own RP Holdings Class B Interests conduct exchanges for our Class A ordinary shares.

The net income attributable to the continuing non-controlling interests related to the Continuing Investors Partnerships and the Holders of RP Holdings Class E Interests is expected to decline over time if the investors who indirectly own the RP Holdings Class B Interests and the Holders of RP Holdings Class E Interests, respectively, conduct exchanges for our Class A ordinary shares.

Net income attributable to non-controlling interests above can fluctuate significantly from period to period, primarily driven by volatility in the income statement activity of the respective underlying entity as a result of the non-cash charges associated with applying the effective interest accounting methodology to our financial royalty assets as described in the section titled “Understanding Our Financial Reporting.”

Further, the net income attributable to the continuing non-controlling interests ~~will~~includes ~~include~~EPAs ~~net income~~ attributable to ~~the~~Founder’s ~~RP Holdings Class C Special Interest held by EPA Vehicle once certain performance conditions of the~~ Equity ~~Performance~~that ~~Awards~~we ~~have~~began ~~been~~recognizing ~~met, which is expected to occur~~ in ~~2025. The Equity Performance Awards are expected to be allocated to~~ the ~~EPA~~first ~~Vehicle~~quarter ~~quarterly~~of ~~beginning in~~ 2025 ~~and recorded~~ as ~~net~~certain ~~income~~conditions ~~attributable~~were ~~to non-controlling interests~~met. ~~The net income attributable to the RP Holdings Class C Special Interest will be driven by the performance of the Equity Performance Awards as determined on a portfolio-by-portfolio basis.~~

Results of Operations

In this section, we discuss the results of our operations for ~~2024~~2025 compared to ~~2023~~2024. For a discussion of ~~2023~~2024 compared to ~~2022~~2023, please refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2023~~2024.

The comparison of our historical results of operations is as follows (in thousands):

	Years Ended December 31,				Change
	2024		2023		$	%
	2025		2024		$	%
Income and other revenues
Income from financial royalty assets	$	2,~~149~~261,~~422~~152	$	2,~~197~~149,~~754~~422	~~(48~~111,~~332)~~730	(25.2)
Other royalty income and revenues	~~114~~117,~~154~~041		~~156~~114,~~800~~154		~~(42~~2,~~646)~~887	~~(27.~~2).5
Total income and other revenues	2,~~263~~378,~~576~~193		2,~~354~~263,~~554~~576		~~(90~~114,~~978)~~617	(35.9)1
Operating expense
Operating (income)/expense
Provision for changes in expected cash flows from financial royalty assets	~~732~~(295,~~461~~838)		~~560~~732,~~656~~461		~~171~~(1,~~805~~028,299)	~~30.6~~*
Research and development funding expense	2,000		52,000		(50,000)	(96.2)
Provision for credit losses on unfunded commitments	89,032		—		89,032	n/a
General and administrative expenses	236,671		249,748		(13,077)	(5.2)
Research and development funding expense	452,000		2,000		450,000	*
Total operating expense, net	971,132		862,404		108,728	12.6
General and administrative expenses	573,481		236,671		336,810	142.3
Operating income	1,292,444		1,492,150		(199,706)	(13.4)
Total operating expense, net	818,675		971,132		(152,457)	(15.7)
Operating income	1,559,518		1,292,444		267,074	20.7
Other (income)/expense
Equity in earnings of equity method investees	(29,~~611~~089)		(2829,~~882~~611)		~~(729)~~522	2(1.58)
Interest expense	~~225~~307,~~512~~664		~~187~~225,~~187~~512		3882,~~325~~152	2036.54
Other income, net	(~~234~~43,~~270~~249)		(~~366~~234,~~243~~270)		~~131~~191,~~973~~021	(3681.05)
Total other income, net	(38,369)		(207,938)		169,569	(81.5)
Total other expense/(income), net	235,326		(38,369)		273,695	*
Consolidated net income	1,~~330~~324,~~813~~192		1,~~700~~330,~~088~~813		(~~369~~6,~~275~~621)	(210.75)
Net income attributable to non-controlling interests	~~471~~553,~~830~~245		~~565~~471,~~254~~830		~~(93~~81,~~424)~~415	~~(16~~17.5)3
Net income attributable to Royalty Pharma plc	$	~~858~~770,~~983~~947	$	1858,~~134,834~~983	(~~275~~88,~~851~~036)	(2410.32)

*Percentage change is not meaningful.

Total income and other revenues

Income from financial royalty assets

Income from financial royalty assets by top products is as follows, in order of contribution to income in ~~2024~~2025 (in thousands):

	Years Ended December 31,				Change
	2024		2023		$	%
	2025		2024		$	%
Cystic fibrosis franchise	$	~~826~~828,~~205~~181	$	~~852~~826,~~312~~205	~~(26~~1,~~107)~~976	(30.1)2
Evrysdi	~~224~~206,~~429~~972		97224,~~742~~429		~~126~~(17,~~687~~457)	~~129~~(7.68)
Tremfya	147,141		149,716		(2,575)	(1.7)
Voranigo	154,420		46,153		108,267	*
Trelegy	~~146~~154,~~920~~100		~~128~~146,~~051~~920		187,~~869~~180	144.79
Imbruvica	131,090		173,162		(42,072)	(24.3)
Tremfya	152,936		147,141		5,795	3.9
Tysabri	~~124~~116,~~815~~876		~~167~~124,~~536~~815		(427,~~721~~939)	(256.54)
Other products	~~548~~647,~~822~~667		~~629~~633,~~235~~759		~~(80~~13,~~413)~~908	~~(12~~2.8)2
Total income from financial royalty assets	$	2,~~149~~261,~~422~~152	$	2,~~197~~149,~~754~~422	~~(48~~111,~~332)~~730	(25.2)

~~Income~~*Percentage ~~from~~change ~~financial~~is ~~royalty~~not ~~assets decreased by $48~~meaningful.3 million, or 2.2%, in 2024 as compared to 2023, primarily due to a significant milestone receipt in 2023 related to Pfizer’s Zavzpret. The March 2023 FDA approval of Zavzpret resulted in our receipt of a $475.0 million milestone payment, for which we recognized interest income of $153.6 million, as reflected within other products in the above table and which was non-recurring. The decrease was partially offset by the increase in income from Evrysdi attributable to the incremental royalties that we acquired in the fourth quarter of 2023 and second quarter of 2024.

55Income from financial royalty assets increased by $111.7 million, or 5.2%, in 2025 as compared to 2024, primarily due to the addition of Voranigo which we acquired in August of 2024 upon FDA approval, partially offset by lower income from Evrysdi due to a decline in sell-side equity research analysts’ consensus sales forecasts.

Other royalty income and revenues

Other royalty income and revenues ~~decreased~~were byrelatively ~~$42.6~~flat ~~million, or 27.2%,~~ in ~~2024~~2025 as compared to ~~2023, primarily driven by a one-time $50~~2024.~~0 million receipt from Pfizer related to the oral formulation of zavegepant in 2023.~~

Provision for changes in expected cash flows from financial royalty assets

Provision activity is a combination of income and expense items. The provision breakdown by royalty asset (exclusive of the provision for current expected credit losses) based on the largest contributors to each year’s provision income or expense (in thousands) is as follows:

Royalty

~~2024~~2025

Royalty

~~2023~~2024

Evrysdi

378,565

Tysabri

222,285

Cystic fibrosis franchise

(259,353)

Evrysdi

378,565

Cystic fibrosis franchise

256,814

Imbruvica

220,127

Tremfya

(77,895)

Cystic fibrosis franchise

256,814

Crysvita

164,265

Tremfya

120,733

Xtandi

(64,368)

Crysvita

164,265

IDHIFA

(75,059)

Promacta

(41,617)

Promacta

54,772

IDHIFA

(75,059)

Tysabri

(158,433)

Evrysdi

(46,077)

Evrysdi

115,558

Tysabri

(158,433)

Other

65(38,~~894~~389)

Other

6265,~~920~~894

Total provision, exclusive of provision for credit losses

~~632~~(269,~~046~~675)

Total provision, exclusive of provision for credit losses

~~538~~632,~~371~~046

Provision for current expected credit losses

~~100~~(26,~~415~~163)

Provision for current expected credit losses

22100,~~285~~415

Total provision

~~732~~(295,~~461~~838)

Total provision

~~560~~732,~~656~~461

In ~~2024~~2025, we recorded provision ~~expense~~income of $~~732~~295.58 million, comprised of $~~632~~269.07 million in provision ~~expense~~income for changes in expected cash flows and $~~100~~26.42 million in provision ~~expense~~income for current expected credit losses. We recorded provision ~~expense~~income for changes in expected cash flows primarily related to ~~Evrysdi~~the cystic fibrosis franchise, Tremfya, and Xtandi due to ~~declines~~increases in sell-side equity research analysts’ consensus sales forecasts., Wepartially ~~recorded~~offset by provision expense ~~for changes in expected cash flows~~ related to ~~the~~Evrysdi ~~cystic fibrosis franchise, primarily~~ due to ~~the~~declines ~~inclusion of consensus estimates~~ in 2024 for Vertex’s Alyftrek and the conservative assumption that royalties will only be collected on the tezacaftor component of Alyftrek and not on the deuterated ivacaftor component. Although we believe that the deuterated ivacaftor component of Alyftrek is the same as ivacaftor and is therefore royaltysell-~~bearing,~~side ~~Vertex~~equity ~~has~~research ~~made~~analysts’ ~~public~~consensus statements that it believes the deuterated ivacaftor component is not royalty-bearing. If deuterated ivacaftor is determined to be royalty-bearing, we may recognize provision income in our results of operations at that time. Additionally, we recorded provision expense for Crysvita due to declines in sales forecasts. The provision ~~expense~~income for ~~changes~~credit inlosses ~~expected~~was ~~cash~~primarily ~~flows~~related ~~was~~to ~~partially~~Niktimvo ~~offset~~as bya ~~provision~~result ~~income~~of ~~for~~ changes in ~~expected~~sell-side ~~cash~~equity ~~flows~~research ~~related~~analysts’ toconsensus ~~Tysabri due increases in~~ sales forecasts., ~~The~~partially ~~provision~~offset ~~expense for credit losses was primarily driven~~ by the addition of ~~Niktimvo~~Imdelltra to our portfolio.

In ~~2023~~2024, we recorded provision expense of $~~560~~732.75 million, comprised of $~~538~~632.40 million in provision expense for changes in expected cash flows and $22100.34 million in provision expense for current expected credit losses. We recorded provision expense for changes in expected cash flows ~~for~~primarily ~~Tysabri,~~related ~~Imbruvica~~to ~~and~~Evrysdi ~~Tremfya primarily~~ due to declines in sell-side equity research analysts’ consensus sales forecasts. We recorded provision expense for changes in expected cash flows related to the cystic fibrosis franchise, primarily due to the inclusion of consensus estimates in 2024 for Vertex’s Alyftrek and the conservative assumption that royalties will only be collected on the tezacaftor component of Alyftrek and not on the deuterated ivacaftor component. Although we believe that the deuterated ivacaftor component of Alyftrek is the same as ivacaftor and is therefore royalty-bearing, Vertex has made public statements that it believes the deuterated ivacaftor component is not royalty-bearing. If deuterated ivacaftor is determined to be royalty-bearing, we may recognize provision income in our results of operations at that time or recognize higher interest income prospectively. Additionally, we recorded provision expense for Crysvita due to declines in sales forecasts. The provision expense for changes in expected cash flows was partially offset by provision income for changes in expected cash flows related to Tysabri due increases in sales forecasts. The provision expense for credit losses was primarily driven by the ~~additions~~addition of ~~Skytrofa~~Niktimvo ~~and Adstiladrin~~ to our portfolio.

Provision for credit losses on unfunded commitments

Provision for credit losses on unfunded commitments was $89.0 million in 2025, related to our funding arrangement with Revolution Medicines, which was entered into in June 2025.

R&D funding expense

R&D funding expense ~~decreased~~increased by $50450.0 million, ~~or 96.2%,~~ in ~~2024~~2025 as compared to ~~2023.~~2024 Indue ~~2023,~~to ~~we recognized~~ R&D funding ~~expense~~arrangements ofentered ~~$50.0~~into ~~million~~in 2025 related to adaraxonrasib ~~clinical~~and ~~milestone~~litifilimab ~~payment~~of ~~for~~$250.0 million ~~aficamten~~and $200. 0 million, respectively.

G&A expenses

G&A expenses ~~decreased~~increased by $13336.1 8 million, or 5142.23%, in ~~2024~~2025 as compared to ~~2023~~2024, primarily ~~from~~driven ~~lower~~by ~~Operating~~additional ~~and~~share-based ~~Personnel~~compensation ~~Payments~~expenses inof $287.1 million recognized following the ~~current~~Internalization ~~period~~and acquisition-related costs of $28.9 million ~~The~~incurred ~~higher~~for ~~expense~~the Internalization. The increase in ~~2023~~G&A expenses was ~~due~~also partially attributable to higher ~~Portfolio~~Management ~~Receipts,~~Fees ~~which~~of ~~included~~$33.0 ~~the~~million ~~one~~pre-~~time~~Internalization ~~receipt~~as a result of athe ~~$475.0~~January ~~million~~2025 ~~Zavzpret~~sale ~~milestone~~of ~~payment~~the MorphoSys Development Funding Bonds.

Equity in earnings of equity method investees

Equity in earnings of equity method investees ~~was~~were relatively flat in ~~2024~~2025 as compared to ~~2023~~2024. In ~~2024~~2025, we recorded an income ~~allocation~~allocations from the Legacy SLP Interest of $1917.2 0 million and $12.1 million from the Avillion Entities, primarily driven by a gain related to the ~~positive~~FDA ~~result~~approval of Airsupra’s ~~Phase~~supplemental ~~III~~new ~~clinical~~drug ~~trial~~application which triggered a milestone ~~payment~~payable from AstraZeneca to the Avillion Entities. In ~~2023~~2024, we recorded an income ~~allocation~~allocations from the Legacy SLP Interest of $2410.64 million and $19.2 million from the Avillion Entities, primarily driven by a gain related to ~~AstraZeneca~~the positive result of Airsupra’s ~~election~~Phase toIII ~~exercise~~clinical ~~the~~trial ~~option~~which totriggered ~~commercialize~~a ~~Airsupra~~milestone inpayment from AstraZeneca to the ~~United~~Avillion ~~States~~Entities.

Interest expense

Interest expense increased by $3882.3 2 million, or 2036.54% in ~~2024~~2025 as compared to ~~2023~~2024, primarily driven by the issuance of the $1.5 billion and $2.0 billion of senior unsecured notes in June 2024. ~~The~~and ~~increase~~September ~~was~~2025, ~~partially~~respectively, ~~offset~~and by the ~~repayment of~~ $~~1.0~~380 ~~billion~~million ofterm ~~senior~~loan ~~unsecured~~that ~~notes~~we inassumed ~~September~~as ~~2023~~part ~~upon~~of ~~maturity~~the Internalization. The weighted average coupon rate on our senior unsecured notes outstanding as of December 31, ~~2024~~2025 and ~~2023~~2024 was 3.0675% and 23.4806%, respectively.

Refer to the “Liquidity and Capital Resources” section for additional discussion of our debt financing arrangements.

Other income, net

Other income, net of $43.2 million in 2025 was primarily comprised of $45.9 million of gains on available for sale debt securities and $33.6 million of interest income earned on cash and cash equivalents, partially offset by $21.9 million of losses on equity securities. The gains on available for sale debt securities were primarily driven by the changes in fair value of the Cytokinetics Funding Arrangements.

Other income, net of $234.3 million in 2024 was primarily comprised of $154.9 million of gains on available for sale debt securities, $47.3 million of interest income earned on cash and cash equivalents and $39.5 million of gains on equity securities. The gains on available for sale debt securities were primarily driven by the changes in fair value of the MorphoSys Development Funding Bonds.

Other income, net of $366.2 million in 2023 was primarily comprised of $230.8 million of gains on available for sale debt securities, $87.1 million of gains on equity securities and $72.3 million of interest income earned on cash and cash equivalents. The gains on available for sale debt securities were primarily driven by the changes in fair value of the MorphoSys Development Funding Bonds.

Net income attributable to non-controlling interests

Net income attributable to the Legacy Investors Partnerships increased by $2737.5 6 million in ~~2024~~2025 as compared to ~~2023~~2024, primarily driven by higher net income attributable to Old RPI. The higher net income is a result of provision income recognized in ~~2024~~2025 as compared to provision expense recognized in ~~2023~~2024.

Net income attributable to the Continuing Investors Partnerships decreased by $~~115~~45.8 6 million in ~~2024~~2025 as compared to ~~2023~~2024, primarily ~~due~~driven toby lower net income attributable to RP Holdings as a result of higher ~~provision~~R&D expense and share-based compensation expense recognized in ~~the~~2025, ~~current~~which ~~period~~was partially offset by provision income. Conversely, in 2024, we recognized provision expense and minimal R&D expense and share-based compensation expense.

Net income attributable to Founder’s Equity was $60.2 million in 2025. We began recognizing EPAs in the first quarter of 2025 as certain conditions were met during the period. Total EPAs earned in 2025 was $81.2 million, attributable to Founder’s Equity and Employee EPAs, with settlement consisting of a combination of Class A ordinary shares and cash distributions provided as tax advances.

Net income attributable to RP Holdings Class E Interests was $29.2 million in 2025. The RP Holdings Class E Interests were issued in connection with the Internalization.

Portfolio Overview

Our business model is different from that of traditional operating companies in the biopharmaceutical industry. Our operating performance is a function of our liquidity as our operations have historically been financed primarily with cash flows generated by our royalties. We use the cash generated by our existing royalties to fund investments in new royalties. We consider a variety of metrics in assessing the performance of our business. Portfolio Receipts is a key performance metric that represents our ability to generate cash from our portfolio investments, the primary source of capital that we can deploy to make new portfolio investments. Portfolio Receipts also enables management to better analyze our liquidity and long-term growth prospects by providing a more granular product-by-product presentation of the underlying cash generation of our royalty investments.

57Portfolio Receipts is defined as the sum of royalty receipts and milestones and other contractual receipts. Royalty receipts include variable payments based on sales of products, net of contractual payments to the legacy non-controlling interests, that are attributed to us (“Royalty Receipts”). Milestones and other contractual receipts include sales-based or regulatory milestone payments and other fixed contractual receipts, net of contractual payments to the legacy non-controlling interests, that are attributed to us. Portfolio Receipts does not include royalty receipts and milestones and other contractual receipts that were received on an accelerated basis under the terms of the agreement governing the receipt or payment. Portfolio Receipts also does not include proceeds from equity securities or proceeds from purchases and sales of marketable securities, both of which are not central to our fundamental business strategy.

Portfolio Receipts is ~~defined~~calculated as the sum of ~~royalty~~the ~~receipts~~following ~~and~~line ~~milestones~~items ~~and~~from ~~other~~our ~~contractual~~GAAP ~~receipts.~~consolidated ~~Royalty~~statements ~~receipts~~of ~~include~~cash ~~variable~~flows: ~~payments~~Cash ~~based~~collections onfrom ~~sales~~financial ofroyalty ~~products~~assets, ~~net~~Cash ofcollections ~~contractual~~from ~~payments~~intangible toroyalty ~~the legacy non-controlling interests~~assets, ~~that~~Other ~~are~~royalty ~~attributed~~cash tocollections, usProceeds ~~(“Royalty~~from ~~Receipts”).~~available ~~Milestones~~for ~~and~~sale ~~other~~debt ~~contractual~~securities ~~receipts include sales-based or regulatory milestone payments~~ and ~~other~~Distributions ~~fixed~~from ~~contractual~~equity ~~receipts,~~method ~~net~~investees ofless ~~contractual~~Distributions ~~payments~~ to ~~the~~ legacy non-controlling interests, ~~that~~- ~~are attributed to us.~~ Portfolio Receipts, ~~does~~which ~~not~~represent ~~include~~contractual ~~proceeds~~distributions ~~from equity securities or proceeds from purchases and sales~~ of ~~marketable~~Royalty ~~securities~~Receipts, ~~both~~milestones ofand ~~which~~other ~~are~~contractual ~~not~~receipts ~~central~~ to ~~our~~the ~~fundamental~~Legacy ~~business~~Investors ~~strategy~~Partnerships.

Portfolio Receipts is calculated as the sum of the following line items from our GAAP statements of cash flows: Cash collections from financial royalty assets, Cash collections from intangible royalty assets, Other royalty cash collections, Proceeds from available for sale debt securities and Distributions from equity method investees less Distributions to legacy non-controlling interests - Portfolio Receipts, which represent contractual distributions of Royalty Receipts, milestones and other contractual receipts to RPSFT and the Legacy Investors Partnerships. Distributions to RPSFT substantially ended in December 2023 when we acquired the remaining interest in RPCT held by RPSFT.54

Our portfolio consists of royalties on more than 35 marketed therapies and 1420 development-stage product candidates. The therapies in our portfolio address therapeutic areas such as rare disease, ~~cancer~~oncology, neuroscience, infectious disease, hematology and diabetes, and are delivered to patients across both primary and specialty care settings. The table below shows Portfolio Receipts, including Royalty Receipts by product and milestones and other contractual receipts, in order of contribution to total Royalty Receipts in ~~2024~~2025 (in thousands):

			Years Ended December 31,				Change
Products	Marketer(s)	Therapeutic Area	~~2024~~2025		~~2023~~2024		$	%
Cystic fibrosis franchise(1)	Vertex	Rare disease	$	~~856~~916,~~792~~869	$	~~770~~856,~~673~~792	8660,~~119~~077	117.20
Trelegy	GSK	Respiratory	~~283~~332,~~747~~451		~~203~~283,~~299~~747		8048,~~448~~704	3917.62
Tysabri	Biogen	Neuroscience	~~261~~249,~~671~~619		~~279~~261,~~431~~671		(1712,~~760~~052)	(6.4.6)
Imbruvica	AbbVie, Johnson & Johnson	Cancer	191,014		210,289		(19,275)	(9.2)
Evrysdi	Roche	Rare disease	201,584		173,508		28,076	16.2
Evrysdi	Roche	Rare disease	173,508		66,072		107,436	162.6
Xtandi	Pfizer, Astellas	Oncology	196,917		168,667		28,250	16.7
Xtandi	Pfizer, Astellas	Cancer	168,667		146,418		22,249	15.2
Tremfya	Johnson & Johnson	Immunology	178,398		139,561		38,837	27.8
Promacta	Novartis	Hematology	158,419		161,163		(2,744)	(1.7)
Imbruvica	AbbVie, Johnson & Johnson	Oncology	170,357		191,014		(20,657)	(10.8)
Tremfya	Johnson & Johnson	Immunology	139,561		116,387		23,174	19.9
Promacta	Novartis	Hematology	141,780		158,419		(16,639)	(10.5)
Cabometyx/Cometriq	Exelixis, Ipsen, Takeda	Cancer	72,647		65,778		6,869	10.4
Voranigo	Servier	Oncology	118,206		4,928		113,278	*
Spinraza	Biogen	Rare disease	44,981		44,628		353	0.8
Cabometyx/Cometriq	Exelixis, Ipsen, Takeda	Oncology	84,551		72,647		11,904	16.4
Trodelvy	Gilead	Cancer	43,094		33,149		9,945	30.0
Spinraza	Biogen	Rare disease	52,452		44,981		7,471	16.6
Erleada	Johnson & Johnson	Cancer	38,997		27,377		11,620	42.4
Trodelvy	Gilead	Oncology	46,605		43,094		3,511	8.1
Orladeyo	BioCryst	Rare disease	38,737		29,337		9,400	32.0
Erleada	Johnson & Johnson	Oncology	46,150		38,997		7,153	18.3
Nurtec ODT/Zavzpret	Pfizer	Neuroscience	25,513		18,376		7,137	38.8
Imdelltra	Amgen	Oncology	9,625		—		9,625	n/a
Other products(2)			~~273~~381,~~271~~265		~~277~~332,~~039~~593		(348,~~768)~~672	(114.4)6
Royalty Receipts			$	23,~~770~~126,~~619~~829	$	2,~~449~~770,~~416~~619	~~321~~356,~~203~~210	1312.19
Milestones and other contractual receipts			30,827		599,297		(568,470)	(94.9)
Milestones and Other Contractual Receipts			127,532		30,827		96,705	313.7
Portfolio Receipts			$	2,801,446	$	3,048,713	(247,267)	(8.1)
Portfolio Receipts(3)			$	3,254,361	$	2,801,446	452,915	16.2

*Percentage change is not meaningful.

(1)The cystic fibrosis franchise includes the following approved products: Kalydeco, Orkambi, Symdeko/Symkevi, Trikafta/Kaftrio and Alyftrek, which was approved by the FDA in December 2024.

(2)Other products primarily include Royalty Receipts on the following products: ~~Cimzia,~~ Crysvita, Emgality, Entyvio, Farxiga/Onglyza, IDHIFA, ~~Lexiscan,~~ Nesina, Nurtec ODT, Orladeyo, Prevymis, Soliqua and distributions from the Legacy SLP Interest, which are presented as Distributions from equity method investees on the consolidated statements of cash flows.

58(3)Portfolio Receipts for 2025 does not include the $511 million of proceeds from our sale of the MorphoSys Development Funding Bonds because it was treated as an asset sale.

Analysis of Portfolio Receipts

The key drivers of Portfolio Receipts are discussed below:

•Cystic fibrosis franchise – Royalty Receipts from the cystic fibrosis franchise, including Kalydeco, Orkambi, Symdeko/Symkevi, ~~and~~ Trikafta/Kaftrio and Alyftrek, which is marketed by Vertex for ~~patients~~the ~~with~~treatment ~~certain~~of ~~mutations causing~~ cystic fibrosis, increased by $8660.1 million in ~~2024~~2025 as compared to ~~2023~~2024. The increase was primarily ~~driven~~due byto ~~the~~strong ~~continued~~cystic ~~U.S.~~fibrosis ~~performance~~patient ofdemand ~~Trikafta~~globally and ~~the~~higher ~~strong~~net ~~uptake~~realized ofpricing ~~Kaftrio~~in ~~outside of~~ the United States, ~~including~~while ~~its~~Ex-U.S. ~~uptake~~saw instrong ~~younger~~performance ~~age~~across ~~groups~~multiple markets, partially offset by a revenue decline in Russia.

•Trelegy – Royalty Receipts from Trelegy, which is marketed by GSK for the maintenance treatment of chronic obstructive pulmonary disease and asthma, increased by $8048.4 7 million in ~~2024~~2025 as compared to ~~2023~~2024, primarily driven by ~~strong~~continued growth across all regions, reflecting patient demand, single inhaler triple therapy class growth, and increased market share. ~~Additionally, performance was also positively impacted by favorable U.S. pricing and adjustments to returns and rebates.~~

•Tysabri – Royalty Receipts from Tysabri, which is marketed by Biogen for the treatment of multiple sclerosis, decreased by $1712.8 1 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~primarily~~ due to ~~pricing~~increased ~~pressure~~competition in rest of world, partially offset by a favorable U.S. rebate estimate change and ~~competition~~inventory dynamics.

•Imbruvica – Royalty Receipts from Imbruvica, which is marketed by AbbVie and Johnson & Johnson for the treatment of blood cancers and chronic graft versus host disease, decreased by $19.3 million in 2024 as compared to 2023, primarily due to competitive pressures.55

•Evrysdi – Royalty Receipts from Evrysdi, which is marketed by Roche for the treatment of spinal muscular atrophy, increased by $~~107~~28.4 1 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~primarily~~ attributable to ~~the~~strong ~~incremental~~growth ~~royalties~~globally, ~~acquired~~partially inoffset ~~the~~by ~~fourth~~tender-related ~~quarter~~buying ofpatterns ~~2023 and the second quarter of 2024 and gains~~ in ~~patient~~international ~~share across all regions~~sales.

•Xtandi – Royalty Receipts from Xtandi, which is marketed by Pfizer and Astellas for the treatment of prostate cancer, increased by $2228.2 3 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~primarily~~attributable ~~attributed~~ to sales growth inacross all regions, ~~especially~~particularly in the United States, driven by strong uptake of the non-metastatic castration-sensitive prostate cancer indication following approval in the fourth quarter of 2023, which also increased demand in other indications, and overall market growth.

•~~Promacta~~Tremfya – Royalty Receipts from ~~Promacta~~Tremfya, which is marketed by ~~Novartis~~Johnson & Johnson for the treatment of ~~chronic~~plaque ~~immune~~psoriasis, ~~thrombocytopenia~~active ~~purpura~~psoriatic ~~(ITP)~~arthritis and ~~aplastic~~inflammatory ~~anemia~~bowel disease, ~~decreased~~increased by $238.7 8 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~primarily~~driven ~~due to higher revenue deductions, partially offset~~ by anshare ~~increased~~gains ~~use of Promacta in chronic ITP~~ and ~~severe~~market ~~aplastic~~growth, ~~anemia~~including instrong ~~the~~uptake ~~United~~across ~~States.~~recently Inlaunched ~~the~~inflammatory ~~third~~bowel ~~quarter~~disease ~~of 2024~~indications, ~~Novartis~~partially ~~disclosed~~offset ~~that~~by itthe ~~had~~impact ~~discontinued proactive promotion~~ of ~~Promacta~~Medicare inPart ~~most~~D ~~markets~~redesign.

•~~Tremfya~~Imbruvica – Royalty Receipts from ~~Tremfya~~Imbruvica, which is marketed by AbbVie and Johnson & Johnson for the treatment of ~~plaque~~blood ~~psoriasis~~cancers and ~~active~~chronic ~~psoriatic~~graft ~~arthritis~~versus host disease, ~~increased~~decreased by $2320.2 7 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~due~~reflecting tocompetitive ~~market~~pressures ~~growth~~ and ~~share~~the ~~gains.~~impact of Medicare Part D redesign.

•~~Cabometyx/Cometriq~~Promacta – Royalty Receipts from ~~Cabometyx/Cometriq~~Promacta, which is marketed by ~~Exelixis,~~Novartis ~~Ipsen and Takeda~~ for the treatment of ~~advanced~~chronic ~~renal~~immune ~~cell~~thrombocytopenia ~~carcinoma~~purpura as(“ITP”) ~~well~~and asaplastic ~~hepatocellular carcinoma in patients previously treated with sorafenib~~anemia, ~~increased~~decreased by $616.9 6 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~primarily~~due ~~driven~~to bydiscontinued ~~continued~~promotion ~~demand growth~~ in ~~the~~most ~~United~~markets ~~States~~ and ~~globally~~the byU.S. ~~broad~~launch ~~uptake~~of ingeneric ~~combination~~competition ~~with Opdivo~~ in ~~first-line~~May ~~renal cell carcinoma across clinical risk groups and practice settings~~2025.

•~~Spinraza~~Voranigo – Royalty Receipts from ~~Spinraza~~Voranigo, which is marketed by ~~Biogen~~Servier for the treatment of ~~spinal~~low-grade ~~muscular atrophy~~glioma, ~~was~~increased ~~relatively~~by ~~flat~~$113.3 million in ~~2024~~2025 as compared to ~~2023~~2024, primarily ~~due~~driven ~~to relatively consistent U.S. revenue while rest of world was impacted~~ by ~~the~~its ~~loss~~strong oflaunch ~~an annual tender~~ in ~~Russia, as well as by~~ the ~~timing~~United ~~of shipments~~States. We acquired the ~~Spinraza~~Voranigo royalty in the ~~first~~third quarter of ~~2023~~2024 shortly after it was approved and began ~~receiving~~recording ~~royalties~~Royalty Receipts in the ~~second~~fourth quarter of ~~2023~~2024.

59•Cabometyx/Cometriq – Royalty Receipts from Cabometyx/Cometriq, which is marketed by Exelixis, Ipsen and Takeda, primarily for the treatment of advanced renal cell carcinoma and hepatocellular carcinoma, increased by $11.9 million in 2025 as compared to 2024, primarily driven by continued demand growth from uptake in combination with Opdivo in first-line renal cell carcinoma and previously treated advanced neuroendocrine tumors (“NET”).

•~~Trodelvy~~Spinraza – Royalty Receipts from ~~Trodelvy~~Spinraza, which is marketed by ~~Gilead~~Biogen for the treatment of ~~adult~~spinal ~~patients~~muscular ~~with metastatic triple-negative breast cancer and pre-treated hormone receptor (HR)-positive~~atrophy, ~~human epidermal growth factor receptor 2 (HER2)-negative metastatic breast cancer,~~ increased by $97.9 5 million in ~~2024~~2025 as compared to ~~2023~~2024. ~~The~~Royalties ~~increase~~in ~~was~~the ~~primarily~~first ~~driven~~quarter byof ~~higher~~2024 ~~demand~~were inlower ~~second-line~~due ~~metastatic~~to ~~triple-negative~~the ~~breast~~$1.5 ~~cancer~~billion ~~and~~cap, ~~pretreated~~benefiting ~~HR+/HER2-~~royalty ~~metastatic~~receipts ~~breast~~growth ~~cancer~~in 2025.

•~~Erleada~~Trodelvy – Royalty Receipts from ~~Erleada~~Trodelvy, which is marketed by ~~Johnson~~Gilead ~~& Johnson~~ for the treatment of ~~patients~~metastatic ~~with~~triple-negative ~~prostate~~breast cancer, ~~increased~~and bypre-treated ~~$11.6 million~~hormone inreceptor ~~2024 as compared to 2023~~(“HR”)-positive, ~~primarily~~human ~~driven~~epidermal bygrowth ~~continued~~factor ~~share~~receptor ~~gains~~2 ~~and~~(“HER2”)-negative ~~market growth in~~ metastatic ~~castration-sensitive~~breast ~~prostate~~ cancer., Weincreased ~~acquired~~by an$3.5 ~~incremental~~million ~~royalty on Erleada~~ in ~~the~~2025 ~~second~~as ~~quarter~~compared ofto ~~2023~~2024, ~~and~~primarily ~~began~~driven ~~receiving~~by ~~the~~strong ~~additional royalty in the third quarter of 2023~~demand.

•~~Orladeyo~~Erleada – Royalty Receipts from ~~Orladeyo~~Erleada, which is marketed by ~~BioCryst~~Johnson & Johnson for the treatment of ~~hereditary~~prostate ~~angioedema~~cancer, increased by $97.4 2 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~primarily~~ driven by market growth and continued ~~strong~~share ~~patient~~gains, ~~uptake~~partially ~~and~~offset anby ~~improved~~the ~~paid~~impact ~~rate~~of Medicare Part D redesign.

•~~Nurtec~~Imdelltra ~~ODT/Zavzpret~~ – Royalty Receipts from ~~Nurtec ODT~~Imdelltra, which is marketed by ~~Pfizer~~Amgen for the ~~acute~~ treatment of ~~migraine,~~extensive-stage ~~increased~~small bycell ~~$7.1 million~~lung incancer ~~2024~~were ~~as compared to 2023~~$9.6 ~~The~~million ~~increase~~in ~~was~~2025, primarily driven by its strong ~~demand~~global inlaunch ~~the~~as ~~United~~it ~~States,~~establishes ~~and,~~a tonew astandard ~~much~~of ~~lesser~~care ~~extent,~~in ~~recent~~second-line ~~launches~~extensive instage ~~international~~small ~~markets.~~cell ~~Performance~~lung ~~was~~cancer ~~partially~~(“ES-SCLC”). ~~offset~~We byacquired ~~lower~~the ~~net~~Imdelltra ~~price~~royalty in the ~~United~~third ~~States~~quarter ~~due~~of to2025 ~~unfavorable~~and ~~changes~~began receiving Royalty Receipts in ~~channel~~the ~~mix~~fourth quarter of 2025.

•Other products – Royalty Receipts from other products ~~decreased~~increased by $348.8 7 million in ~~2024~~2025 as compared to ~~2023~~2024, ~~primarily~~ driven by arecently ~~decline~~launched inproducts ~~royalty~~including ~~receipts~~Niktimvo, onSkytrofa ~~Lexiscan~~and Rytelo, as well as the timing of Soliqua royalty payments, partially offset by the expiration of royalties on Entyvio and a one-time true-up of royalties on the DPP-IVs ~~and~~received ~~higher~~in ~~distributions from~~ the ~~Legacy~~prior ~~SLP~~year ~~Interest~~period.

•Milestones and other contractual receipts decreased by $568.5 million in 2024 as compared to 2023, primarily due to a $475.0 million milestone payment received following the FDA’s approval of Zavzpret and a $28.7 million payment from our joint venture investee, Avillion II, for our pro rata portion of the $80 million fee paid by AstraZeneca to exercise the option to commercialize Airsupra in United States, both of which occurred in the first quarter of 2023.56

•Milestones and other contractual receipts increased by $96.7 million in 2025 as compared to 2024, primarily attributable to a one-time distribution related to the Legacy SLP Interest and a milestone payment in the amount of $27.4 million related to Airsupra.

Key Developments Relating to Our Portfolio

Recent key developments related to products in our portfolio are discussed below:

Commercial Products

•Cystic fibrosis franchise. In ~~April~~July ~~2024~~2025, Vertex announced that the European Commission ~~had~~(“EC”) ~~granted~~approved ~~approval~~Alyftrek for ~~the~~people ~~label~~with ~~expansion~~cystic offibrosis ~~Kalydeco~~ages ~~for~~6 ~~the~~years ~~treatment~~and ofolder ~~infants~~who ~~down~~have toat least one ~~month~~non-class ofI ~~age~~mutation ~~with cystic fibrosis who have certain mutations~~ in the cystic fibrosis transmembrane conductance regulator gene.

In ~~May~~April ~~2024~~2025, Vertex announced ~~that~~EC itapproval ~~submitted~~for athe ~~New~~label ~~Drug~~expansion ~~Application~~of ~~(“NDA”)~~Kaftrio ~~and~~in ~~Marketing~~combination ~~Authorization~~with ~~Application~~ivacaftor ~~(“MAA”)~~ for ~~the~~cystic ~~vanzacaftor~~fibrosis ~~triple~~patients toages ~~the~~2 ~~FDA~~years and ~~the~~older ~~European~~who ~~Medicines~~have ~~Agency,~~at ~~respectively,~~least ~~for~~one ~~approval.~~non-class ~~This~~I ~~followed~~mutation ~~positive~~in ~~Phase 3 results for~~ the ~~new~~cystic ~~triple~~fibrosis ~~combination~~transmembrane ~~therapy~~conductance inregulator ~~February~~(“CFTR”) ~~2024~~gene.

•Tysabri. In November ~~2024~~2025, ~~Vertex~~Sandoz announced ~~that it had completed regulatory submissions for~~ the ~~vanzacaftor~~U.S. ~~triple~~launch inof ~~the European Union~~Tyruko, the ~~United~~first ~~Kingdom, Canada, Australia, New Zealand~~ and ~~Switzerland,~~only ~~and~~FDA-approved ~~reviews~~biosimilar ~~are~~to ~~underway~~Biogen’s Tysabri.

•Xtandi. In ~~December~~July ~~2024~~2025, ~~Vertex~~Pfizer and Astellas Pharma announced topline results from the ~~FDA~~overall ~~approval~~survival of(“OS”) analysis from the ~~new~~Phase ~~triple~~3 EMBARK study evaluating Xtandi in men with non-~~combination~~metastatic ~~modulator~~hormone-sensitive ~~Alyftrek~~prostate ~~(vanzacaftor~~cancer. ~~triple)~~For ~~for~~patients ~~treatment~~treated ofwith ~~cystic~~Xtandi ~~fibrosis~~plus inleuprolide ~~people~~versus ~~ages~~placebo 6plus leuprolide, EMBARK met the key secondary endpoint with a statistically significant and ~~older~~clinically meaningful improvement in OS. Results also showed a favorable trend towards improved OS for patients treated with atXtandi ~~least~~monotherapy ~~one~~versus ~~responsive~~placebo ~~mutation~~plus leuprolide, however the difference did not reach statistical significance.

60•Tremfya. In May 2025, Johnson & Johnson announced that the EC approved Tremfya for the treatment of adult patients with moderately to severely active Crohn’s disease.

~~•Xtandi.~~ In ~~January~~April ~~2024~~2025, ~~Pfizer~~Johnson & Johnson announced that the ~~European~~EC ~~Commission had~~ approved ~~Talzenna~~Tremfya ~~(talazoparib), an oral poly ADP-ribose polymerase inhibitor, in combination with Xtandi,~~ for the treatment of adult patients with ~~metastatic~~moderately ~~castration-resistant~~to ~~prostate~~severely ~~cancer~~active inulcerative ~~whom chemotherapy is not clinically indicated~~colitis.

In April ~~2024~~2025, ~~Astellas~~Johnson ~~Pharma~~& Johnson announced that the ~~European~~Phase ~~Commission~~3b ~~approved~~APEX astudy ~~label~~achieved ~~extension~~both ~~for~~its ~~Xtandi~~primary asendpoint ~~monotherapy~~of orreducing insigns ~~combination~~and ~~with~~symptoms ~~androgen~~and ~~deprivation~~its ~~therapy~~major ~~for~~secondary ~~the~~endpoint ~~treatment~~ of ~~adult~~reducing ~~men~~progression ~~with~~of ~~high-risk~~structural ~~biochemical~~damage ~~recurrent~~in ~~non-metastatic~~adults ~~hormone-sensitive~~living ~~prostate~~with ~~cancer~~active ~~who~~psoriatic ~~are~~arthritis, ~~unsuitable~~compared ~~for~~to ~~salvage-radiotherapy~~placebo.

~~•Tremfya.~~ In ~~May~~March ~~2024~~2025, Johnson ~~and~~& Johnson announced ~~positive~~that ~~Phase~~the 3FDA ~~results~~approved ~~for~~ Tremfya in ~~patients with moderate to severely active~~ Crohn’s disease, ~~with~~which ~~inadequate~~is ~~response/intolerance~~now tothe ~~conventional~~first ~~therapies~~ and~~/or~~ ~~biologics.~~only ~~Johnson~~IL-23 ~~and~~offering ~~Johnson~~both ~~submitted~~subcutaneous aand ~~supplemental~~intravenous ~~Biologics~~induction ~~License~~options ~~Application~~for to the ~~FDA~~treatment ~~seeking approval~~ of ~~Tremfya~~adults ~~for~~with ~~Crohn’s~~moderately ~~disease and an application~~ to ~~the~~severely ~~European~~active ~~Medicines Agency for ulcerative colitis and~~ Crohn’s disease.

•Promacta. In May ~~2024~~2025, ~~Johnson~~Camber ~~and~~Pharmaceuticals ~~Johnson~~ announced the ~~first Phase 3 results for Tremfya in adult patients with moderate to severely active Crohn’s disease, which demonstrated superiority versus placebo and Stelara~~U.S. ~~Data~~launch ~~showed that both maintenance doses~~ of ~~Tremfya~~eltrombopag, ~~met~~ the ~~composite co~~AB-~~primary~~rated ~~endpoints~~generic ~~compared~~for ~~to placebo in each individual study~~Promacta. ~~In results versus Stelara, both doses of Tremfya demonstrated statistically significant and clinically meaningful differences on all prespecified pooled endoscopic endpoints.~~

•Cabometyx. In ~~September~~July ~~2024~~2025, ~~Johnson~~Ipsen ~~and Johnson~~ announced that the ~~FDA~~EC ~~approval~~approved ofCabometyx ~~Tremfya~~ for ~~the~~patients ~~treatment of adults~~ with ~~moderately~~previously totreated ~~severely~~advanced ~~active~~neuroendocrine ~~ulcerative colitis~~tumors.

~~•Cabometyx.~~ In ~~September~~March ~~2024~~2025, Exelixis announced ~~final~~that ~~results from~~ the ~~Phase~~FDA 3approved ~~pivotal~~Cabometyx CONTACT-02 study, which achieved one of two primary endpoints, demonstrating a statistically significant benefit in progression-free survival, and a numerical but not statistically significant improvement in overall survival for ~~cabozantinib in combination with atezolizumab in~~ patients with ~~metastatic~~previously ~~castration-resistant~~treated ~~prostate~~advanced ~~cancer.~~neuroendocrine ~~Exelixis intends to submit a supplemental NDA with the FDA later this year~~tumors.

•Spinraza. In ~~September~~January ~~2024~~2026, ~~Exelixis~~Biogen announced ~~final~~that ~~results from~~ the ~~Phase~~EC 3granted ~~pivotal~~marketing ~~CABINET~~authorization ~~study, which demonstrated a significant improvement in progression-free survival~~ for ~~cabozantinib in patients with advanced neuroendocrine tumors. Exelixis submitted~~ a ~~supplemental~~high ~~NDA,~~dose ~~which~~regimen ~~was assigned a Prescription Drug User Fee Act (“PDUFA”) date~~ of ~~April~~Spinraza ~~2025,~~for ~~and~~spinal ~~Ipsen~~muscular ~~has submitted an extension of indication Marketing Authorization to the European Medicines Agency~~atrophy.

•Trodelvy. In January 2024, Gilead announced that the Phase 3 EVOKE-01 study evaluating Trodelvy compared to docetaxel did not meet its primary endpoint of overall survival in patients with previously treated metastatic non-small cell lung cancer.57

•Trodelvy. In ~~May~~November ~~2024~~2025, Gilead announced ~~that~~ the ~~confirmatory~~ Phase 3 ~~TROPiCS~~ASCENT-0407 study ~~evaluating~~investigating Trodelvy ~~versus~~as ~~single~~a first-~~agent~~line ~~chemotherapy~~(“1L”) intreatment ~~patients~~for ~~with~~HR+/HER2-negative ~~locally advanced or~~ metastatic ~~urothelial~~breast cancer patients did not meet the primary endpoint of ~~overall~~progression-free survival. ~~Gilead~~Overall survival is ~~continuing~~a tokey ~~analyze~~secondary ~~the~~endpoint ~~data~~ and ~~will~~was ~~discuss~~not ~~the~~mature ~~results~~at ~~and next steps with~~ the ~~FDA.~~time ~~In the United States, Trodelvy has an accelerated approval in this indication and continued approval may be contingent upon verification and description~~ of ~~clinical benefit in confirmatory trials, including~~ the ~~TROPiCS-04~~primary ~~study~~analysis.

In ~~November~~October ~~2024~~2025, Gilead announced ~~plans~~that tobased ~~voluntarily~~on ~~withdraw~~ the ~~U.S.~~positive ~~accelerated~~Phase ~~approval~~3 ofupdates ~~Trodelvy~~from ~~for~~ASCENT-03 ~~use~~and ~~in pre~~ASCENT-~~treated~~04, ~~adult~~it ~~patients~~has ~~with~~submitted ~~locally~~two ~~advanced~~supplemental orbiologics ~~metastatic~~license ~~urothelial~~applications ~~cancer,~~for ~~following~~Trodelvy ~~the~~in ~~results~~1L ofmetastatic ~~the~~triple-negative ~~Phase~~breast 3cancer ~~TROPiCS-04~~(“mTNBC”) ~~trial~~and expects regulatory decisions in 2026.

~~•Spinraza.~~ In ~~September~~May ~~2024~~2025, ~~Biogen~~Gilead Sciences announced ~~the~~positive ~~pivotal~~topline ~~cohort~~results ~~(Part~~from ~~B) of~~ the Phase 2/3 ~~DEVOTE~~ASCENT-03 study. ~~evaluating~~The ~~the~~study ~~safety~~met ~~and~~its ~~efficacy~~primary ofendpoint, demonstrating a ~~higher~~highly ~~dose~~statistically ~~regimen~~significant ofand ~~Spinraza~~clinically meaningful improvement in ~~infants~~progression-free survival (“PFS”) compared to chemotherapy in patients with ~~spinal~~1L ~~muscular~~mTNBC ~~atrophy~~who ~~met~~are ~~its~~ineligible ~~primary~~to receive immunotherapy. Overall survival, a key secondary endpoint, ~~achieving~~was anot ~~statistically~~mature ~~significant~~at ~~improvement~~the intime ~~motor~~of ~~function~~PFS ~~compared~~primary toanalysis. aGilead ~~prespecified~~will ~~matched~~continue ~~sham~~to ~~control~~monitor ~~group~~OS outcomes.

61In April 2025, Gilead announced positive topline results from the Phase 3 Ascent-04/Keynote-D19 study, demonstrating that Trodelvy plus Keytruda significantly improved PFS compared to Keytruda and chemotherapy in patients with previously untreated PD-L1+ mTNBC. Overall survival, a key secondary endpoint, was not mature at the time of the PFS primary analysis. However, there was an early trend in improvement for OS with Trodelvy plus Keytruda and Gilead will continue to monitor OS outcomes.

•~~Voranigo~~Airsupra. In ~~August~~September ~~2024~~2025, ~~Servier~~AstraZeneca announced that the FDA ~~approval~~approved ofa ~~Voranigo,~~supplemental aNDA ~~first-in-class~~for ~~targeted~~Airsupra ~~therapy~~to ~~for~~reflect the statistically significant severe exacerbation risk reduction in patients with ~~isocitrate~~mild ~~dehydrogenase~~asthma 1compared ~~and~~to 2albuterol ~~(IDH1/2)~~based ~~mutant~~on ~~diffuse~~the ~~glioma~~BATURA study results.

•~~Skytrofa~~Cobenfy. In December ~~2024~~2025, ~~Ascendis~~Bristol Myers Squibb announced ~~the~~that ~~FDA~~it ~~accepted~~will ~~for~~enroll ~~review~~additional ~~its~~patients ~~supplemental~~in ~~Biologics~~the ~~License~~Phase ~~Application~~3 ~~(sBLA)~~ADEPT-2 instudy ~~adult~~of ~~growth~~Cobenfy ~~hormone~~in ~~deficiency~~psychosis ~~for~~associated ~~Skytrofa~~with Alzheimer’s disease. ~~The~~Following consultation with the FDA ~~set~~and a ~~PDUFA~~review ~~goal~~by ~~date~~the ofindependent ~~July~~Data 27Monitoring Committee, ~~2025~~the study will continue as planned, with results expected by the end of 2026.

~~•Cobenfy.~~ In ~~March~~April ~~2024~~2025, Bristol Myers Squibb announced that ittopline ~~completed~~results ~~its~~from ~~acquisition~~the ofPhase ~~Karuna.~~3 ~~Bristol~~ARISE ~~Myers~~trial ~~Squibb~~evaluating ~~acquired~~Cobenfy ~~Karuna~~as ~~for~~an ~~$330~~adjunctive ~~per~~treatment ~~share,~~to ~~for~~atypical aantipsychotics ~~total~~in ~~equity~~adults ~~value~~with ofschizophrenia ~~$14.0~~did ~~billion.~~not ~~The~~reach ~~NDA for KarXT for~~ the ~~treatment~~threshold ~~of schizophrenia in adults was accepted~~ for ~~review by FDA, with~~ a ~~PDUFA~~statistically ~~date~~significant ofdifference ~~September~~compared ~~26,~~to ~~2024~~placebo.

•Imdelltra. In ~~September~~November ~~2024~~2025, ~~Bristol~~Amgen ~~Myers Squibb~~ announced that the FDA granted full approval to Imdelltra for the treatment of ~~Cobenfy~~adult ~~(formerly~~patients ~~KarXT),~~with aES-SCLC ~~first~~with disease progression on or after platinum-~~in-class~~based ~~muscarinic~~chemotherapy, ~~agonist~~converting ~~for~~Imdelltra’s ~~the~~prior ~~treatment~~accelerated ofapproval ~~schizophrenia~~into ina ~~adults.~~full approval.

•~~Airsupra~~Myqorzo. In ~~October~~December ~~2024~~2025, ~~AstraZeneca~~Cytokinetics announced ~~that positive high-level results from~~ the ~~BATURA~~FDA ~~Phase~~approval 3bof ~~trial~~Myqorzo ~~showed~~(formerly ~~Airsupra~~known ~~met~~as ~~the~~aficamten) ~~primary~~for ~~endpoint, demonstrating a statistically significant and clinically meaningful reduction in~~ the ~~risk~~treatment of aadults ~~severe~~with ~~exacerbation~~symptomatic ~~when~~obstructive ~~used~~hypertophic ~~as an as-needed rescue medication in response to symptoms compared to as-needed albuterol~~cardiomyopathy.

In May 2025, Cytokinetics announced positive topline results from MAPLE-HCM, a Phase 3 trial comparing aficamten to metoprolol in patients with symptomatic obstructive hypertrophic cardiomyopathy. The study met its primary endpoint, demonstrating a statistically significant improvement in peak oxygen uptake from baseline to Week 24 with a favorable safety profile.

•Skytrofa. In July 2025, Ascendis announced the FDA approved Skytrofa for the once-weekly treatment of adults with growth hormone deficiency.

Development-Stage Product Candidates

•~~Aficamten~~Daraxonrasib. In October ~~2024~~2025, ~~Cytokinetics~~Revolution Medicines announced that itthe ~~submitted~~FDA angranted ~~NDA~~a non-transferrable voucher for ~~aficamten~~daraxonrasib tounder the ~~FDA~~Commissioner’s inNational ~~the~~Priority ~~third~~Voucher ~~quarter~~pilot ofprogram, ~~2024.~~which accelerates target review times to 1-2 months versus 6+ months.

In ~~December~~September ~~2024~~2025, ~~Cytokinetics~~Revolution Medicines announced ~~that~~positive ~~the~~Phase ~~FDA~~1 ~~accepted~~results from its ~~NDA~~clinical ~~for~~trials ~~aficamten~~evaluating ~~for~~daraxonrasib ~~the~~as ~~treatment~~a ofmonotherapy ~~Obstructive~~and ~~Hypertrophic~~daraxonrasib ~~Cardiomyopathy.~~in ~~The~~combination ~~FDA~~with ~~has~~chemotherapy ~~assigned~~in ~~the~~1L ~~NDA~~metastatic apancreatic ~~PDUFA~~ductal ~~date~~adenocarcinoma of(“PDAC”). ~~September~~Based ~~26,~~upon ~~2025.~~these ~~Additionally~~data, ~~the~~Revolution ~~European~~ Medicines ~~Agency~~initiated ~~validated~~a ~~the~~Phase ~~MAA~~3 trial for ~~aficamten,~~daraxonrasib ~~and~~in it1L ~~will~~metastatic ~~now~~PDAC bein ~~reviewed by~~ the ~~Committee~~fourth ~~for~~quarter ~~Medicinal~~of ~~Products for Human Use (CHMP)~~2025.

•~~BCX10013~~Deucrictibant. In ~~August~~December ~~2024~~2025, ~~BioCryst~~Pharvaris announced ~~that~~positive ittopline ~~plans~~data tofrom ~~discontinue~~the ~~development~~RAPIDe-3 ofpivotal Phase 3 study, which met its ~~oral~~primary ~~Factor~~endpoint Dand ~~inhibitor,~~all ~~BCX10013,~~secondary efficacy endpoints with statistical significance. The data will serve as the ~~level~~basis offor ~~clinical~~marketing ~~activity~~authorization ~~observed~~applications ~~was~~expected ~~less~~to ~~than~~be ~~other~~filed ~~therapies~~in onfirst ~~the~~half ~~market~~of 2026.

•~~MK-8189~~Ecopipam. In ~~October~~February ~~2024~~2025, ~~Merck~~Emalex ~~updated~~announced ~~its~~positive ~~public~~Phase ~~disclosures~~3 toresults ~~remove~~for ~~MK-8189~~ecopipam ~~from~~in ~~its~~patients ~~pipeline~~with ~~chart~~Tourette syndrome. The study showed statistical significance between ecopipam and weplacebo dofor ~~not~~both ~~anticipate~~the ~~making~~primary aefficacy ~~further~~endpoint ~~investment~~in pediatrics and the secondary efficacy endpoint in ~~this~~pediatrics ~~program~~and adults.

•~~Pelabresib~~Litifilimab. In ~~February~~October ~~2024~~2025, ~~Novartis~~Biogen announced that itboth ~~had~~litifilimab ~~entered~~Phase ~~into~~3 anstudies ~~agreement~~for tosystemic ~~make~~lupus aerythematosus ~~voluntary~~are ~~public~~fully ~~takeover~~enrolled ~~offer~~with toexpected ~~acquire~~data ~~MorphoSys~~readout for ~~€68~~both ~~per~~studies ~~share,~~accelerated ~~for~~to athe ~~total~~second ~~equity~~half ~~value~~ of €22026.~~7 billion.~~

•Obexelimab. In ~~May~~January ~~2024~~2026, ~~Novartis~~Zenas BioPharma (“Zenas”) announced ~~that~~positive itresults from the Phase 3 INDIGO trial of obexelimab in Immunoglobulin G4-related disease (“IgG4-RD”), which met ~~all~~the ~~tender~~primary ~~offer~~endpoint ~~conditions~~demonstrating toa ~~acquire~~clinically ~~MorphoSys~~meaningful ~~for~~and ~~€68~~highly ~~per~~statistically ~~share.~~significant ~~The~~reduction ~~acquisition~~in risk of ~~MorphoSys~~IgG4-RD byflare. ~~Novartis~~Zenas ~~has~~anticipates ~~been~~submitting ~~completed~~a Biologics License Application in Q2 2026 and a Marketing Authorization Application to the European Medicines Agency (“EMA”) in the second half of 2026.

In October ~~2024~~2025, ~~Novartis~~Zenas announced ~~that~~positive ~~based~~results onfrom ~~its~~the ~~review~~Phase 2 trial of ~~48-week~~obexelimab ~~data~~in ~~from~~relapsing ~~the~~multiple ~~Phase~~sclerosis, 3which ~~MANIFEST-2~~demonstrated ~~study,~~a ~~longer~~highly ~~follow-up~~statistically ~~time~~significant is95% ~~needed~~relative toreduction ~~determine~~in ~~the~~new ~~regulatory~~gadolinium ~~path~~(Gd)-enhancing ~~for~~T1 ~~pelabresib~~lesions inover ~~myelofibrosis.~~week ~~Novartis~~8 ~~will~~and ~~continue~~week to12 ~~follow~~compared ~~patients~~with inplacebo. ~~MANIFEST-2~~Zenas ~~and~~anticipates ~~evaluate~~reporting ~~the~~24-week ~~potential~~data ~~for~~in ~~additional~~the ~~studies~~first toquarter ~~support~~of ~~registration~~2026.

•~~Seltorexant~~Pelabresib. In ~~May~~January ~~2024~~2026, ~~Johnson~~Novartis ~~and Johnson~~ announced ~~positive~~plans ~~results~~to ~~from~~submit ~~the~~a ~~pivotal~~European ~~Phase~~Union 3regulatory ~~MDD3001~~filing ~~clinical~~for ~~trial~~pelabresib ~~evaluating the efficacy and safety of seltorexant as an adjunctive treatment~~ in ~~patients~~2026, ~~with major depressive disorder (MDD) with insomnia symptoms. The study achieved all primary~~ and ~~secondary~~that ~~endpoints,~~it ~~with~~would ~~seltorexant~~begin ~~demonstrating both~~ a ~~statistically~~new ~~significant~~Phase ~~and~~3 ~~clinically~~study ~~meaningful improvement~~ in ~~depressive~~the ~~symptoms,~~United ~~and improved sleep disturbance outcomes~~States, inCanada ~~patients~~and ~~who had a prior inadequate response to SSRI/SNRI antidepressants alone~~Japan.

62•TEV-‘749. In December 2025, Teva Pharmaceuticals (“Teva”) submitted a NDA to the FDA for TEV-‘749 (“olanzapine LAI”) for the treatment of schizophrenia in adults.In January 2025, Teva announced that olanzapine LAI achieved Phase 3 targeted injections without Post-injection Delirium/Sedation Syndrome (“PDSS”).

•~~TEV-’749~~Trontinemab. In ~~May~~September ~~2024~~2025, ~~Teva~~Roche ~~Pharmaceuticals~~ announced ~~positive~~that ~~efficacy~~it ~~results~~initiated ~~from~~the ~~its~~ Phase 3 ~~trial~~program ~~evaluating~~for ~~TEV-’749,~~trontinemab ~~a once monthly subcutaneous long-acting injection of olanzapine,~~ in ~~adult~~early ~~patients~~symptomatic ~~with schizophrenia. Results demonstrated that TEV-~~Alzheimer’~~749~~s ~~met its primary endpoint as measured by a change in the Positive and Negative Syndrome Scale (PANSS) total score from baseline after eight weeks compared to placebo~~disease. Additionally, noRoche ~~cases~~announced ofplans ~~Post-injection~~to ~~Delirium/Sedation~~initiate ~~Syndrome~~a ~~(PDSS)~~Phase ~~had~~3 ~~been~~study ~~reported~~in bypreclinical ~~that~~Alzheimer’s ~~date~~disease, ~~after~~in ~~administration~~people ofat ~~approximately~~high ~~80%~~risk of ~~the~~cognitive ~~minimum target injection number~~decline.

~~In January 2025, Teva announced that TEV-‘749 achieved Phase 3 targeted injections without PDSS, and the full safety presentation is expected in the second quarter of 2025.~~59

•Trontinemab. In March 2024, Roche held a neurology update event in which it announced that in people with Alzheimer’s Disease, trontinemab demonstrated rapid and robust amyloid plaque reduction at relatively low doses compared with standard Aβ monoclonal antibodies. The sustained low Amyloid Related Imaging Abnormalities incidence and overall favorable safety and tolerability profile support further investigation.

In October 2024, Roche presented its latest Phase 1b/2a interim results for trontinemab at the Clinical Trials on Alzheimer’s Disease conference, which demonstrated rapid and robust amyloid plaque depletion after 12 to 28 weeks of treatment and an overall favorable safety profile with very limited ARIA-E observed.

Investments Overview

Ongoing investment in new royalties is fundamental to the long-term prospects of our business. New investments provide a source of growth for our Royalty Receipts, supplementing growth within our existing portfolio and offsetting declines for royalties on products that have lost market exclusivity. We evaluate an array of royalty acquisition opportunities on a continuous basis and expect to continue to make acquisitions in the ordinary course of our business. We have established a strong track record of identifying, evaluating and investing in royalties tied to leading products across therapeutic areas and treatment modalities. We invest in approved products and development-stage product candidates that have generated robust proof of concept data. We invest in these therapies through the purchase of royalties, milestones and other contractual receipts by making hybrid investments and by acquiring businesses with significant existing royalty assets or the potential for the creation of such assets.

In ~~2024~~2025, we invested $2.8 6 billion in royalties, milestones and other contractual receipts. While volatility exists in the funding of new acquisitions on a year-to-year basis due to the unpredictable timing of new investment opportunities, we have consistently deployed significant amounts of cash when measured over multi-year periods. Our approach is rooted in a highly disciplined evaluation process that is not dictated by a minimum annual investment threshold.

Included below are tables of investment activities over each of the last five years (in thousands). Announced transactions amounts reflect maximum transaction value for transactions entered into over each of the periods presented. Capital Deployment represents the total outflows that will drive future Portfolio Receipts and includes cash paid at the acquisition date and any subsequent associated milestone investments reflected in the period in which cash was paid. Capital Deployment in approved/marketed royalties versus development-stage royalties is based upon the approval status of the therapy at the time of our upfront investment.

Average

~~2024~~2025

~~2023~~2024

~~2022~~2023

~~2021~~2022

~~2020~~2021

Announced Transactions

Upfront payments

2,~~125~~104,~~400~~600

21,~~325~~965,000

2,~~109~~325,000

12,~~963~~109,000

21,~~161~~963,000

2,~~069~~161,000

Potential payments/milestones

~~973~~1,445,200

~~493~~2,735,000

1493,~~850,~~000

1,~~443~~850,000

~~705~~1,443,000

~~375~~705,000

Total announced transaction value

3,~~098~~549,~~600~~800

24,~~818~~700,000

32,~~959~~818,000

3,~~406~~959,000

23,~~866~~406,000

2,~~444~~866,000

Capital Deployment

Approved/marketed royalties

1,~~732~~776,~~145~~045

1,~~775~~733,~~545~~720

1,~~875~~775,~~232~~545

1,~~920~~875,~~958~~232

1,~~684~~920,~~769~~958

1,~~404~~574,~~222~~769

Development-stage royalties(1)

~~693~~720,~~762~~986

~~985~~862,~~364~~102

~~316~~985,~~689~~364

~~507~~316,~~399~~689

~~823~~507,~~374~~399

~~835~~933,~~986~~374

Total Capital Deployment(2)

2,~~425~~497,~~907~~031

2,~~760~~595,~~909~~822

2,~~191~~760,~~921~~909

2,~~428~~191,~~357~~921

2,~~508~~428,~~143~~357

2,~~240~~508,~~208~~143

(1)Development-stage royalties include: direct R&D funding arrangements and funding arrangements executed through our joint venture partnership with the Avillion Entities, investments in development-stage product candidates and investments in debt securities primarily made in connection with acquisitions of royalties on development-stage products from the seller.

(2)Capital Deployment is calculated as the summation of the following line items from our GAAP consolidated statements of cash flows: Investments in equity method investees, Purchases of available for sale debt securities, Acquisitions of financial royalty assets, Acquisitions of other financial assets, Milestone payments, Development-stage funding payments ~~- ongoing, Development-stage funding payments - upfront and milestone~~ less Contributions from legacy non-controlling interests - R&D.

Summary of Acquisition Activities

•In ~~November~~January ~~2024~~2026, we ~~acquired~~announced a ~~synthetic~~funding ~~royalty~~agreement onwith ~~Rytelo~~Teva ~~from~~for ~~Geron~~TEV-’408 ~~Corporation~~ for anup ~~upfront~~to ~~payment of~~ $~~125~~500 million. ~~Rytelo~~The isagreement ~~approved~~includes ~~for~~$75 ~~the~~million ~~treatment~~to ofco-fund ~~certain~~a ~~adult~~Phase ~~patients~~2b ~~with~~study ~~low-~~for tovitiligo ~~intermediate-1~~targeted ~~risk~~for ~~myelodysplastic~~2026. ~~syndromes~~Based ~~with~~on ~~transfusion-dependent~~the ~~anemia.~~future ~~Following~~results from the ~~acquisition~~Phase 2b study in vitiligo, we ~~are~~will ~~entitled~~have an option to ~~receive~~provide ~~tiered~~an ~~royalties~~additional on$425 ~~the~~million ~~U.S.~~to ~~net~~co-fund ~~sales~~the onPhase ~~Rytelo~~3 development program.

•In ~~November~~December ~~2024~~2025, we acquired athe ~~synthetic~~remaining ~~royalty~~royalties on ~~Niktimvo~~Roche's ~~from~~Evrysdi ~~Syndax Pharmaceuticals, Inc.~~ for ~~an upfront payment of $350 million. Niktimvo is approved for~~ the treatment of ~~chronic~~spinal ~~graft-versus-host~~muscular ~~disease~~atrophy ~~and~~from ~~will~~PTC beTherapeutics ~~co-commercialized~~for byan ~~Incyte.~~upfront ~~Following~~payment ~~the~~of ~~acquisition,~~$240 wemillion ~~are~~and ~~entitled~~up to ~~receive~~$60 ~~royalties~~million onin ~~the U.S. net~~ sales-based ~~on Niktimvo~~milestones.

•In September 2024, we acquired a royalty interest in deucrictibant from BRAIN Biotech AG for an upfront payment of approximately $21 million and up to EUR 110.5 million in milestone payments contingent on the achievements of certain regulatory and commercial milestones. Deucrictibant is in Phase 3 development by Pharvaris N.V. for the treatment of hereditary angioedema attacks.60

•In ~~September~~December ~~2024~~2025, we acquired a ~~synthetic~~pre-existing royalty oninterest ~~Yorvipath~~in Nuvalent's neladalkib and zidesamtinib from ~~Ascendis~~an ~~Pharma~~undisclosed ~~A/S~~party for up to $315 million, including an upfront payment of $~~150~~155 million. ~~Yorvipath~~Neladalkib and zidesamtinib are next-generation tyrosine kinase inhibitors (“TKIs”). Neladalkib is ~~approved~~in development for ~~the~~patients ~~treatment~~with ofanaplastic ~~hypoparathyroidism~~lymphoma kinase (“ALK”) mutation-positive non-small cell lung cancer (“NSCLC”) and zidesamtinib is in ~~adults.~~development for ROS proto-oncogene 1 (“ROS1”) mutation-positive NSCLC.

•In ~~June~~December ~~2024~~2025, ~~PTC~~we ~~Therapeutics,~~announced ~~Inc.~~a ~~(“PTC”)~~transaction ~~exercised its option~~ to ~~sell~~acquire ~~half~~a ofroyalty ~~its~~interest ~~retained~~in ~~royalties~~Denali ~~on Roche~~Therapeutics’s ~~Evrysdi,~~tividenofusp analfa ~~approved product~~ for ~~the~~up ~~treatment~~to ~~of spinal muscular atrophy for approximately~~ $~~242~~275 million. ~~This~~Tividenofusp ~~option~~alfa ~~arose~~is ~~from~~Denali’s ~~the~~lead ~~Evrysdi~~investigational ~~royalty~~TransportVehicleTM-enabled ~~transaction~~enzyme ~~with~~replacement ~~PTC~~therapy ~~that~~for ~~was~~the ~~announced~~treatment inof ~~October~~mucopolysaccharidosis ~~2023,~~type inII ~~which~~(“MPS weII, ~~acquired~~or ~~additional~~Hunter ~~royalty on Evrysdi for $1 billion~~syndrome”). ~~PTC~~We ~~has~~will anmake ~~option~~a to$200 ~~sell~~million ~~its~~payment ~~remaining~~contingent ~~9.5%~~on ofFDA ~~the~~accelerated ~~Evrysdi~~approval ~~royalty~~and ~~for~~a $~~250~~75 million ~~less~~payment ~~royalties~~on ~~received~~EMA ~~until~~approval if achieved by December 31, ~~2025~~2029.

•In ~~May~~November ~~2024~~2025, we ~~announced~~acquired a ~~transaction to acquire a~~ royalty interest in ~~Voranigo~~Alnylam’s Amvuttra from ~~Agios~~Blackstone ~~Pharmaceuticals~~ for an$310 ~~upfront~~million. ~~payment~~Amvuttra ofis ~~$905~~an ~~million~~approved ~~contingent~~ribonucleic onacid ~~FDA~~interference ~~approval.~~(“RNAi”) Intherapeutic ~~August~~for ~~2024,~~the wetreatment ~~made~~of ~~the~~transthyretin ~~upfront~~(“TTR”) ~~payment~~amyloidosis ~~following~~with ~~the~~cardiomyopathy ~~FDA~~and ~~approval~~for onhereditary ~~Voranigo~~TTR amyloidosis with polyneuropathy.

64•In September 2025, we acquired a synthetic royalty on obexelimab from Zenas BioPharma for an upfront payment of $75 million and up to $225 million in milestone payments contingent on the achievements of certain clinical and regulatory events. Obexelimab is in Phase 3 development for the treatment of immunoglobulin G4-related disease and Phase 2 development for relapsing multiple sclerosis and systemic lupus erythematosus.

•In ~~May~~August ~~2024~~2025, we ~~expanded~~acquired ~~our~~a ~~strategic~~royalty ~~funding~~interest ~~collaboration with Cytokinetics, Incorporated (“Cytokinetics”) to provide up to $575 million, including $250 million~~ in ~~upfront~~Amgen’s ~~payments,~~Imdelltra infrom ~~exchange~~BeOne for ~~royalties~~an ~~and~~upfront ~~fixed~~payment payments. This collaboration includes the following key components: a royalty restructuring on aficamten for hypertrophic cardiomyopathy; amended commercial launch funding with two additional tranches for aficamten of $50885 million. ~~upfront~~BeOne ~~with~~had the option to ~~draw~~sell anto us additional ~~$175~~royalties ~~million~~on ~~following~~Imdelltra ~~approval~~for ofup ~~aficamten~~to ~~in oHCM; development funding of~~ $~~100~~65 million ~~upfront~~within ~~for~~twelve ~~the~~months ~~confirmatory~~from ~~Phase~~the 3acquisition ~~clinical~~date ~~trial of omecamtiv mecarbil for heart failure with reduced ejection fraction~~ and ~~$50~~in ~~million~~November ~~upfront for the Phase 2 clinical trial of CK-586 for heart failure with preserved ejection fraction~~2025, ~~which~~BeOne ~~includes~~elected anto ~~option~~sell to ~~invest~~us ~~an additional~~ $~~150~~26 million toof ~~fund~~those ~~Phase~~additional 3royalties. ~~development~~Imdelltra ofis ~~CK-586;~~approved ~~and~~for the ~~purchase~~treatment of ~~$50~~extensive-stage ~~million~~small ofcell ~~Cytokinetics’~~lung ~~common stock~~cancer.

•In ~~May~~June ~~2024~~2025, we ~~acquired~~entered ~~royalties~~into ~~and~~a ~~milestones~~two onpart ~~frexalimab,~~$2 ~~which~~billion ~~was~~funding ~~owned~~arrangement bywith ~~ImmuNext,~~Revolution ~~Inc~~Medicines., ~~for~~The ~~approximately~~funding ~~$525~~arrangement ~~million,~~includes ~~including~~up ~~estimated~~to ~~transaction costs~~$1.25 Webillion, ~~are~~including ~~entitled~~$250 tomillion ~~receive~~upfront, ~~royalties~~to onpurchase ~~annual~~a ~~worldwide~~synthetic ~~net~~royalty ~~sales~~on ofdaraxonrasib ~~frexalimab~~ and ~~milestones~~a ~~related~~senior tosecured ~~the~~term ~~achievement~~loan of ~~certain~~up ~~commercial~~to ~~and~~$750 ~~regulatory events~~million. ~~Frexalimab,~~The ~~which~~first istranche inof ~~development~~the bysenior ~~Sanofi,~~secured isterm aloan ~~second~~must ~~generation~~be ~~anti-CD40~~drawn ~~ligand~~following ~~monoclonal~~FDA ~~antibody~~approval of daraxonrasib. ~~Frexalimab~~Daraxonrasib is ~~being evaluated~~ in Phase 3 ~~clinical~~development ~~studies~~ for the treatment of ~~multiple~~RAS ~~sclerosis~~mutant ~~and~~pancreatic iscancer ~~in Phase 2 clinical studies for systemic lupus erythematosus~~ and ~~Type~~non-small 1cell ~~Diabetes~~lung cancer.

•In ~~January~~February ~~2024~~2025, we ~~acquired~~entered ainto ~~royalty interest in ecopipam for~~ an ~~upfront~~R&D ~~payment~~funding ofarrangement ~~$49~~with ~~million~~Biogen ~~and~~to provide up to $44250 million inover ~~milestone~~six ~~payments~~quarters ~~contingent~~including on$50 million upfront for the ~~achievement~~development of ~~certain regulatory milestones~~litifilimab. ~~Ecopipam~~Litifilimab is in Phase 3 development ~~by Emalex Biosciences~~ for the treatment of ~~Tourette Syndrome~~lupus.

Liquidity and Capital Resources

Overview

Our primary source of liquidity is cash provided by operations. For ~~2024~~2025 and ~~2023~~2024, we generated $2.85 billion and $32.08 billion, respectively, in Net cash provided by operating activities. We believe that our existing capital resources, cash provided by operating activities and access to our Revolving Credit Facility (as defined below) will continue to allow us to meet our operating and working capital requirements, to fund planned strategic acquisitions and R&D funding arrangements, and to meet our debt service obligations for the foreseeable future. We have historically operated at a low level of fixed operating costs. We no longer pay Management Fees following the Internalization, which comprised the majority of our cash G&A expenses historically. Our primary cash operating expenses, other than R&D funding commitments, include interest expense, ~~our~~employee ~~Operating~~personnel ~~and~~costs, ~~Personnel~~rent ~~Payments,~~expense and legal and professional fees.

We have access to substantial sources of funds in the capital markets and we may, from time to time, seek additional capital through a combination of additional debt or equity financings. As of December 31, 2024 and 2023, the par value of all of our outstanding senior unsecured notes was $7.8 billion and $6.3 billion, respectively. Additionally, we have up to $1.8 billion of available revolving commitments under our Revolving Credit Facility. A summary of our borrowing activities, balances and compliance with certain debt covenants under various financing arrangements is included in Note 10–Borrowings of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.61

We have access to substantial sources of funds in the capital markets and we may, from time to time, seek additional capital through a combination of additional debt or equity financings. As of December 31, 2025 and 2024, the par value of all of our outstanding borrowings was $9.2 billion and $7.8 billion, respectively. Additionally, we have up to $1.8 billion of available revolving commitments under our Revolving Credit Facility (as defined below) and up to $350.0 million of an uncommitted line of credit under our Uncommitted Credit Facility (as defined below). A summary of our borrowing activities, balances and compliance with certain debt covenants under various financing arrangements is included in Note 12-Borrowings of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

We have historically funded our investments through operating cash flows, equity contributions and debt. Our low operating costs coupled with a lack of capital expenditures and low taxes have contributed to our strong financial profile, resulting in high operating leverage and high cash flow conversion. We expect to continue funding our current and planned operating costs (excluding acquisitions) principally through our cash flow from operations and investments through cash flow and issuances of equity and debt. We have supplemented our available cash and cash equivalents on hand with attractive debt capital to fund certain strategic acquisitions.

Our ability to satisfy our working capital needs, debt service and other obligations, and to comply with the financial covenants under our financing agreements depends on our future operating performance and cash flow, which are in turn subject to prevailing economic conditions and other factors, many of which are beyond our control.

Cash Flows

The following table and analysis of cash flow changes presents a summary of our cash flow activities for ~~2024~~2025 as compared to ~~2023~~2024 (in thousands). For a discussion of cash flow activities for ~~2023~~2024 compared to ~~2022~~2023, please refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2023~~2024.

Years Ended December 31,

2024

2023

Change

2025

2024

Change

Cash provided by/(used in):

Operating activities

2,~~768~~489,~~986~~823

2,~~987~~768,~~802~~986

(~~218~~279,~~816~~163)

Investing activities

(21,~~678~~614,~~115~~180)

(2,~~072~~678,~~789~~115)

~~(605~~1,~~326)~~063,935

Financing activities

~~361~~(1,~~145~~185,973)

(2361,~~148,754)~~145

2(1,~~509~~547,~~899~~118)

Analysis of Cash Flow Changes

Operating Activities

Cash provided by operating activities decreased by $~~218~~279.82 million in ~~2024~~2025 as compared to ~~2023~~2024, primarily due to a$450.0 ~~decrease~~million inof ~~cash~~higher ~~collections~~payments ~~from~~for ~~financial~~development-stage ~~royalty~~funding ~~assets~~agreements ofand $~~218~~116.07 million. Inof ~~2023,~~higher ~~cash~~interest ~~collections~~payments, ~~from~~partially ~~financial~~offset ~~royalty~~by ~~assets included~~ a $~~475~~371.03 million ~~milestone~~increase ~~payment~~in ~~related~~cash tocollections ~~Zavzpret.~~from ~~The~~financial ~~decrease~~royalty ~~was partially offset by lower development-stage funding payments in 2024~~assets.

Investing Activities

Cash used in investing activities ~~increased~~decreased by $~~605~~1.31 ~~million~~billion in ~~2024~~2025 as compared to ~~2023~~2024, primarily driven by ~~higher~~lower ~~use of~~ cash used for ~~purchases~~acquisitions of financial royalty assets, ~~available~~of ~~for~~$808.0 ~~sale~~million ~~debt securities, equity securities~~ and ~~higher~~$511 ~~milestone~~million ~~payments.~~in ~~The higher use of cash was partially offset by~~ proceeds from ~~equity~~the ~~securities~~sale ~~received~~of in the ~~current~~MorphoSys ~~year~~Development Funding Bonds.

Financing Activities

Cash ~~provided~~used byin financing activities in ~~2024~~2025 was $~~361.~~1.2 ~~million~~billion as compared to cash ~~used~~provided inby financing activities of $2361.1 ~~billion~~million in ~~2023~~2024. In ~~2024~~2025, cash ~~provided~~used byin financing activities was primarily driven by the ~~net proceeds of~~ $1.52 billion ~~from~~repurchases ~~issuance~~ of ~~the~~our ~~2024~~Class ~~Notes~~A ~~(as~~ordinary ~~further~~shares ~~described~~and ~~below)~~the repayment of $1.0 billion debt, which was partially offset by the ~~use~~net ofproceeds ~~cash~~from ~~for~~the ~~dividends~~issuance ~~and~~of ~~distributions~~$2.0 ~~and~~billion ~~repurchases~~ of ~~Class~~senior Aunsecured ~~ordinary shares~~notes. In ~~2023~~2024, cash ~~used~~provided inby financing activities was primarily driven by the net proceeds from the issuance of $1.05 billion inof ~~debt~~senior ~~repayment~~unsecured notes, partially offset by the use of cash for dividends and distributions and repurchases of Class A ordinary shares.

Sources of Capital

As of December 31, ~~2024~~2025 and ~~2023~~2024, our cash and cash equivalents totaled $~~929~~618.07 million and $~~477~~929.0 million, respectively. We intend to fund short-term and long-term financial obligations as they mature through cash and cash equivalents, future cash flows from operations or the issuance of additional debt. Our ability to generate cash flows from operations, issue debt or enter into financing arrangements on acceptable terms could be adversely affected if there is a material decline in the sales of the underlying pharmaceutical products in which we hold royalties, deterioration in our key financial ratios or credit ratings, or other material unfavorable changes in business conditions. Currently, we believe that we have sufficient financial flexibility to issue debt, enter into other financing arrangements and attract long-term capital on acceptable terms to support our growth objectives.

Borrowings

Our borrowings consisted of the following (in thousands):

Type of Borrowing	Date of Issuance	Maturity	As of December 31, ~~2024~~2025		As of December 31, ~~2023~~2024
Senior Unsecured Notes:
$1,000,000, 1.20% (issued at 98.875% of par)	9/2020	9/2025	$	~~1,000,000~~—	$	1,000,000
$1,000,000, 1.75% (issued at 98.284% of par)	9/2020	9/2027	1,000,000		1,000,000
$500,000, 5.15% (issued at 98.758% of par)	6/2024	9/2029	500,000		—500,000
$1,000,000, 2.20% (issued at 97.760% of par)	9/2020	9/2030	1,000,000		1,000,000
$600,000, 4.45% (issued at 98.909% of par)	9/2025	3/2031	600,000		—
$600,000, 2.15% (issued at 98.263% of par)	7/2021	9/2031	600,000		600,000
$500,000, 5.40% (issued at 97.872% of par)	6/2024	9/2034	500,000		—500,000
$900,000, 5.20% (issued at 97.989% of par)	9/2025	9/2035	900,000		—
$1,000,000, 3.30% (issued at 95.556% of par)	9/2020	9/2040	1,000,000		1,000,000
$1,000,000, 3.55% (issued at 95.306% of par)	9/2020	9/2050	1,000,000		1,000,000
$700,000, 3.35% (issued at 97.565% of par)	7/2021	9/2051	700,000		700,000
$500,000, 5.90% (issued at 97.617% of par)	6/2024	9/2054	500,000		—500,000
Total senior unsecured debt			7,800,000		6,300,000
$500,000, 5.95% (issued at 95.824% of par)	9/2025	9/2055	500,000		—
Unamortized debt discount and issuance costs			(187,574)		(164,715)
Term Loan	See below	7/2026	380,000		—
Total debt carrying value			7,612,426		6,135,285
Total senior unsecured debt			9,180,000		7,800,000
Less: Current portion of long-term debt			(997,773)		—
Unamortized debt discount and issuance costs			(229,083)		(187,574)
Total long-term debt			$	6,614,653	$	6,135,285
Total debt carrying value			8,950,917		7,612,426
Less: Current portion of long-term debt			$	(380,000)	$	(997,773)
Total long-term debt			$	8,570,917	$	6,614,653

Senior Unsecured Notes

InAs ~~June 2024, we issued $1.5 billion~~ of ~~senior~~December ~~unsecured~~31, ~~notes (the “2024 Notes”) with a weighted average coupon rate of 5.48%. In July 2021~~2025, weour ~~issued~~total ~~$1.3~~principal ~~billion~~amount of senior unsecured notes ~~(the~~outstanding ~~“2021~~was ~~Notes”) with a weighted average coupon rate of 2.80%. In September 2020, we issued~~ $68.0 8 billion ~~of senior unsecured notes~~ (the “~~2020~~ Notes”) with a weighted average coupon rate of 23.1375%. ~~We refer to the 2020 Notes, 2021 Notes and 2024 Notes, collectively, as the “Notes.”~~ The Notes require semi-annual interest payments. ~~The first interest payment date for the 2024 Notes will be March 2, 2025.~~ Indentures governing the Notes contain certain covenants with which we were in compliance as of December 31, ~~2024~~2025.

Term Loan assumed from Internalization

In connection with the Internalization, RP Holdings and RP Manager were each joined as a borrower under RPM’s then existing $380 million term loan (the “Term Loan”) with Bank of America, N.A (as amended, the “Loan Agreement”). Pablo Legorreta, Legorreta Investments, LLC and Legorreta Investments II LLC are guarantors under the Term Loan. Upon the closing of the Internalization, RPM was released as a borrower under the Term Loan. In the third quarter of 2025, the Loan Agreement was amended to accelerate the maturity of the Term Loan to July 31, 2026 and decrease the applicable interest rate. Following the amendment, the Term Loan is subject to an interest rate, at our option, of either (i) the Daily SOFR plus 1.25% or (ii) Term SOFR plus 1.25%, each as defined in the Loan Agreement. Interest is payable in arrears quarterly. We made the first interest payment in the third quarter of 2025. The Term Loan is subject to certain customary covenants, that among other things, require us to maintain (i) a Consolidated Leverage Ratio, (ii) a Consolidated Coverage Ratio, and (iii) a Consolidated Portfolio Cash Flow Ratio, each as described further below under the description of the Credit Agreement that governs the Revolving Credit Facility.

Uncommitted Credit Facility

In August 2025, we entered into an uncommitted line of credit agreement with Société Générale (the “Uncommitted Credit Facility”) which provides for an aggregate borrowing capacity of up to $350.0 million for general corporate purposes within a quarter. As of December 31, 2025, there were no outstanding borrowings under the Uncommitted Credit Facility.

Senior Unsecured Revolving Credit Facility

Our subsidiary, RP Holdings, as borrower, initially entered into the Amended and Restated Revolving Credit Agreement (the “Credit Agreement”) on September 15, 2021, which provides for an unsecured revolving credit facility (the “Revolving Credit Facility”). Amendment No. 3 to the Credit Agreement, which was entered into on December 22, 2023, increased the borrowing capacity to $1.8 billion for general corporate purposes with $1.69 billion of the revolving commitments maturing on December 22, 2028 and the remaining $110.0 million of revolving commitments maturing on October 31, 2027. On January 24, 2024 and April 8, 2025, we entered into ~~Amendment~~Amendments No. 4 and 5, respectively, to the Credit Agreement to make certain technical modifications. As of December 31, ~~2024~~2025, we have a borrowing capacity of $1.8 billion under the Revolving Credit Facility.

The Credit Agreement that governs the Revolving Credit Facility ~~contains~~and the amended loan agreement that governs the Term Loan contain certain customary covenants, that among other things, require us to maintain (i) a ~~consolidated~~Consolidated ~~leverage~~Leverage ~~ratio~~Ratio at or below 4.00 to 1.00 (or at or below 4.50 to 1.00 following a qualifying material acquisition) of consolidated funded debt to Adjusted EBITDA, each as defined and calculated as set forth in the Credit Agreement, (ii) a ~~consolidated~~Consolidated ~~coverage~~Coverage ~~ratio~~Ratio at or above 2.50 to 1.00 of Adjusted EBITDA to consolidated interest expense, each as defined and calculated as set forth in the Credit Agreement and (iii) a ~~consolidated~~Consolidated Portfolio Cash Flow Ratio at or below 5.00 to 1.00 (or at or below 5.50 to 1.00 following a qualifying material acquisition) of consolidated funded debt to Portfolio Cash Flow, each as defined and calculated as set forth in the Credit Agreement. We were in compliance with the financial covenants as of December 31, 2025.

We were in compliance with the financial covenants as of December 31, 2024.

Adjusted EBITDA and Portfolio Cash Flow are non-GAAP liquidity measures that are key components of certain material covenants contained within the Credit Agreement. Noncompliance with the financial covenants under the Credit Agreement could result in our lenders requiring us to immediately repay all amounts borrowed. If we cannot satisfy these financial covenants, we would be prohibited under our Credit Agreement from engaging in certain activities, such as incurring additional indebtedness, paying dividends, making certain payments and acquiring and disposing of assets.

The table below presents Adjusted EBITDA and Portfolio Cash Flow, each as calculated according to its respective definition in our Credit Agreement (in thousands):

	Years Ended December 31,
	2024		2023
	2025		2024
Portfolio Receipts	$	23,~~801~~254,~~446~~361	$	32,~~048~~801,~~713~~446
Payments for operating and professional costs	(236,225)		(243,012)
Payments for operating and professional costs(1)	(288,138)		(236,225)
Adjusted EBITDA (non-GAAP)	$	2,~~565~~966,~~221~~223	$	2,~~805~~565,~~701~~221
Interest paid, net	(~~113~~241,~~088~~983)		(97113,~~564~~088)
Portfolio Cash Flow (non-GAAP)	$	2,~~452~~724,~~133~~240	$	2,~~708~~452,~~137~~133

(1)In 2025, amount included a $33 million payment related to the Management Fees on the sale of the MorphoSys Development Funding Bonds and payments of $29 million for acquisition-related costs for the Internalization. Both payments are non-recurring. Following the Internalization, we no longer pay Management Fees and instead, we compensate employees directly.

Adjusted EBITDA and Portfolio Cash Flow are non-GAAP liquidity measures that exclude the impact of certain items and therefore have not been calculated in accordance with GAAP. We caution readers that amounts presented in accordance with our definitions of Adjusted EBITDA and Portfolio Cash Flow may not be the same as similar measures used by other companies or analysts. A reconciliation of Adjusted EBITDA and Portfolio Cash Flow to Net cash provided by operating activities, the closest GAAP measure, is presented below (in thousands):

	Years Ended December 31,
	2024		2023
	2025		2024
Net cash provided by operating activities (GAAP)	$	2,~~768~~489,~~986~~823	$	2,~~987~~768,~~802~~986
Adjustments:
Proceeds from available for sale debt securities(1), (2)	1921,~~786~~226		119,~~440~~786
Distributions from equity method investees(2)	23105,~~641~~149		4323,~~882~~641
Interest paid, net(2)	~~113~~241,~~088~~983		97113,~~564~~088
Development-stage funding payments - ongoing	2,000		2,000
Development-stage funding payments	452,000		2,000
Development-stage funding payments - upfront and milestone	—		50,000
Distributions to legacy non-controlling interests - Portfolio Receipts(2)	(354,901)		(362,280)
Distributions to legacy non-controlling interests - Portfolio Receipts(2)	(362,280)		(376,987)
Payments for Employee EPAs	10,943		—
Adjusted EBITDA (non-GAAP)	$	2,~~565~~966,~~221~~223	$	2,~~805~~565,~~701~~221
Interest paid, net(2)	(~~113~~241,~~088~~983)		(97113,~~564~~088)
Portfolio Cash Flow (non-GAAP)	$	2,~~452~~724,~~133~~240	$	2,~~708~~452,~~137~~133

(1)InAmounts ~~the~~include ~~fourth quarter of 2023, we began receiving~~ quarterly repayments on ~~tranche one of~~ the Cytokinetics Commercial Launch Funding. Inand ~~the~~a ~~fourth quarter of 2024, we began receiving~~ quarterly ~~repayments~~repayment on the MorphoSys Development Funding Bonds. ~~Repayments~~in ~~for~~each ~~both~~of ~~funding~~2025 ~~instruments~~and ~~are~~2024. ~~presented~~The asMorphoSys ~~Proceeds~~Development ~~from~~Funding ~~available~~Bonds ~~for~~were ~~sale~~sold ~~debt~~in ~~securities~~January ~~on the statements of cash flows~~2025.

(2)The table below shows the line item for each adjustment and the direct location for such line item onin the consolidated statements of cash flows.


Reconciling Adjustment			Statements of Cash Flows Classification
Interest paid, net			Operating activities (Interest paid less Interest received)

Distributions from equity method investees			Investing activities
Proceeds from available for sale debt securities			Investing activities
Distributions to legacy non-controlling interests - Portfolio Receipts			Financing activities

Uses of Capital

Acquisitions of Royalties

We acquire product royalties in ways that can be tailored to the needs of our partners through a variety of structures:

•Synthetic Royalties – Newly-created royalties on approved or late-stage development therapies with strong proof of concept and high commercial potential. A synthetic royalty is the contractual right to a percentage of top-line sales by the developer or marketer of a therapy in exchange for funding. A synthetic royalty may also include contingent milestone payments. We also fund ongoing R&D for biopharmaceutical companies in exchange for future royalties and milestones if the product or indication we are funding is approved.65

•~~Launch~~Synthetic ~~and~~Royalties ~~Development Capital~~ – ~~Tailored~~Newly-created ~~supplemental~~royalties ~~funding~~on ~~solutions,~~approved ~~generally~~or ~~included~~late-stage asdevelopment atherapies ~~component~~with ~~within~~strong aproof ~~transaction, increase the scale~~ of ~~our capital~~concept. ~~Launch~~A ~~and~~synthetic ~~development~~royalty ~~capital~~ is ~~generally~~the ~~provided~~contractual inright ~~exchange~~to ~~for~~ a ~~long-term~~percentage ~~stream~~ of ~~fixed~~top-line ~~payments~~sales ~~with~~by athe ~~predetermined~~developer ~~schedule~~or ~~around~~marketer ~~the launch~~ of a ~~drug.~~therapy ~~Launch and development capital may also include a direct investment~~ in ~~the~~exchange ~~public~~for ~~equity of a company~~funding.

•~~Mergers~~Other ~~and~~Funding ~~Acquisitions~~Modalities ~~(“M&A”) Related~~ – We ~~acquire~~may ~~royalties~~provide inother ~~connection~~forms ~~with M&A transactions, often from the buyers~~ of ~~biopharmaceutical~~capital ~~companies~~to ~~when~~our ~~they~~partners ~~dispose~~as ofa ~~the~~component ~~non-strategic~~within ~~assets~~a ofroyalty ~~the~~transaction ~~target~~to ~~company~~increase ~~following~~ the ~~closing~~scale of ~~the~~our ~~acquisition~~capital. WeThis ~~also seek to partner with companies to acquire other biopharmaceutical companies that own significant royalties. We~~ may ~~also~~include ~~seek~~senior tounsecured ~~acquire~~debt, ~~biopharmaceutical~~direct ~~companies~~equity ~~that~~investments ~~have~~and ~~significant~~launch ~~royalties~~and ordevelopment ~~where~~capital we(in ~~can~~exchange ~~create~~for ~~royalties~~fixed inlong-term ~~subsequent transactions~~payments).

Additionally, we may identify additional opportunities, platforms or technologies that leverage our capabilities.

Distributions to Shareholders

We paid dividends toand ~~holders~~distributions of ~~our Class A ordinary shares of~~ $~~376~~511.59 million and $~~358~~501.38 million in ~~2024~~2025 and ~~2023~~2024, respectively. We do not have a legal obligation to pay a quarterly dividend or dividends at any specified rate or at all.

Class A Ordinary Share Repurchases

In ~~March~~January ~~2023~~2025, our board of directors authorized a new share repurchase program, which replaced the share repurchase program announced on March 27, 2023, under which we may repurchase up to $13.0 billion of our Class A ordinary shares. The repurchases may be made in the open market or in privately negotiated transactions. The new share repurchase program has been approved by our board of directors through June 2027 and shareholders have approved the terms of our share repurchase contracts and counterparties thereto through May 2030. In ~~2024~~2025, we repurchased ~~and retired 8~~37.4 million shares at a cost of approximately $~~229~~1.92 ~~million~~billion. In ~~2023~~2024, we repurchased ~~and retired 9.~~8 .4 million shares at a cost of approximately $~~304~~229.89 million. As of December 31, ~~2024~~2025, approximately $~~465~~1.~~3 million~~8 billion remained available under the new share repurchase program.

In connection with the Internalization, our board of directors authorized a new share repurchase program under which we may repurchase up to $3.0 billion of our Class A ordinary shares. This new share repurchase program replaces the unused capacity under the previous share repurchase program that was authorized in March 2023. The repurchases may be made in the open market or in privately negotiated transactions. The authorization for the new share repurchase program expires June 23, 2027.

Other Funding Arrangements

AsIn ~~part~~June of2025, ~~the expanded funding collaboration~~ we entered into ~~with~~a ~~Cytokinetics~~two-part in$2 ~~May~~billion ~~2024,~~funding wearrangement ~~agreed~~with toRevolution ~~fund~~Medicines. ~~the~~The ~~clinical~~funding ~~trial~~arrangement ~~for~~includes ~~CK-586~~up to $1.25 Webillion, ~~funded~~including $50250 million paid upfront, into ~~May~~purchase ~~2024.~~a Wesynthetic ~~have~~royalty anon ~~option~~daraxonrasib toand ~~fund~~a upsenior tosecured anterm ~~additional~~loan of up to $~~150~~750 million. ~~which~~The wefirst ~~have~~tranche ~~not~~of ~~exercised~~the assenior secured term loan must be drawn following FDA approval of daraxonrasib. As of December 31, ~~2024~~2025, $1 billion of the funding commitment remained unfunded.

69We have a long-term funding arrangement with Cytokinetics which is comprised of seven tranches of up to $525 million in total funding (“Cytokinetics Commercial Launch Funding”). As of December 31, 2025, $175 million remained available under the Cytokinetics Commercial Launch Funding.

We may have aother ~~long-term~~ funding ~~arrangement~~arrangements ~~with~~where ~~Cytokinetics~~we ~~which~~are iscontractually ~~comprised~~obligated ofto ~~seven~~fund ~~tranches~~R&D ofactivities upperformed toby ~~$525~~our ~~million~~development inpartners. ~~total~~We also have funding ~~(“Cytokinetics~~arrangements ~~Commercial~~related ~~Launch~~to ~~Funding”)~~our equity method investments in the Avillion Entities. As ofour ~~December~~committed ~~31,~~capital ~~2024,~~requirements ~~$350~~are ~~million~~based ~~remained~~on ~~available~~phases ~~under~~of ~~Cytokinetics~~development, ~~Commercial~~the ~~Launch~~completion ~~Funding~~ of which ~~Cytokinetics~~ is highly uncertain, only the capital required to ~~draw~~fund athe ~~minimum~~current stage of development under such funding arrangements is considered committed capital, which was approximately $5063.3 million as of December 31, 2025.

We ~~may~~also have ~~other~~certain ~~funding~~milestones ~~arrangements~~payable ~~where we are contractually obligated~~ to ~~fund R&D activities performed by~~ our ~~development~~counterparties ~~partners.~~that Weare ~~also~~contingent ~~have~~on ~~funding~~the ~~arrangements~~successful ~~related~~achievement toof ~~our~~certain ~~equity~~development, ~~method~~regulatory ~~investments~~approval inor ~~the~~commercial ~~Avillion Entities~~milestones. AsThese ~~our~~contingent ~~committed~~milestone ~~capital~~payments ~~requirements~~ are ~~based~~not onconsidered ~~phases~~contractual ofobligations. ~~development,~~In ~~the completion of which is highly uncertain~~2025, ~~only~~we ~~the~~paid ~~capital~~a ~~required~~$200 million toregulatory ~~fund~~milestone ~~the~~following ~~current~~FDA ~~stage~~approval of ~~development~~a ~~under~~new ~~such~~manufacturing ~~funding~~hub ~~arrangements~~for isAdstiladrin ~~considered~~and ~~committed~~sales-based ~~capital,~~milestones ~~which~~of ~~was~~$18.6 ~~approximately~~million and $~~17.3~~ 50 million asrelated ofto ~~December~~Erleada 31and Trelegy, ~~2024~~respectively.

We also have certain milestones payable to our counterparties that are contingent on the successful achievement of certain development, regulatory approval or commercial milestones. These contingent milestone payments are not considered contractual obligations. In 2024, we paid regulatory milestones of $50 million related to olpasiran and $25 million related to Cobenfy. In 2023, we paid a $12.4 million sales-based milestone related to Erleada and a $50 million clinical milestone to Cytokinetics for aficamten.66

Debt Service

AsThe ~~of December 31, 2024, the~~ future principal and interest payments under our Notes ~~over~~as ~~the~~of ~~next~~December ~~five~~31, ~~years~~2025 ~~and thereafter~~ are as follows (in thousands):

Year	Principal Payments		Interest Payments
2025	$	1,000,000	$	257,792
2026	$	—	$	332,431
2026	—		226,600
2027	1,000,000		329,850
2027	1,000,000		226,600
2028	—		312,350
2028	—		209,100
2029	500,000		312,350
2029	500,000		209,100
2030	1,000,000		286,600
Thereafter	56,300,000		23,~~544~~352,~~700~~450
Total(1)	$	78,800,000	$	34,~~673~~926,~~892~~031

(1)Excludes unamortized debt discount and issuance costs of $~~187~~229.6 1 million as of December 31, ~~2024~~2025, which are amortized through interest expense over the remaining life of the underlying debt obligations.

~~Operating~~In ~~and~~addition ~~Personnel~~to ~~Payments~~our Notes, we have a $380 million Term Loan due in July 2026. The interest rate on the Term Loan is variable based on SOFR. Using the SOFR interest rate as of December 31, 2025, the estimated interest payments in 2026 are $17.7 million.

Under the Management Agreement, we pay quarterly Operating and Personnel Payments equal to 6.5% of the cash receipts from Royalty Investments, or Portfolio Receipts, for such quarter and 0.25% of our security investments under GAAP as of the end of each quarter. Because the Operating and Personnel Payments are determined based on Portfolio Receipts, the amounts are variable. The payment for our Operating and Personnel Payment is the most significant component of Payments for operating and professional costs presented on the statements of cash flows. Additionally, the expenses incurred in respect of Operating and Personnel Payments are expected to comprise the most significant component of G&A expenses on an ongoing basis.Leases

In ~~January~~connection ~~2025~~with the Internalization, we ~~agreed~~entered tointo ~~acquire~~an ~~our~~operating ~~Manager~~lease agreement for anour ~~aggregate~~office ~~consideration~~space. ofThe ~~$1.1~~lease ~~billion.~~agreement ~~The~~has ~~transaction~~a isnon-cancelable ~~estimated~~term tothrough ~~close~~October ~~during~~31, ~~the~~2031 ~~second~~and ~~quarter~~a offive-year ~~2025~~extension option. ~~Upon~~As ~~closing~~ of ~~this~~December ~~transaction~~31, we2025, ~~would~~the nofuture ~~longer~~minimum ~~make~~lease ~~Operating~~payments ~~and~~under ~~Personnel~~non-cancelable ~~Payments~~operating toleases over the ~~Manager.~~next five years and thereafter are as follows (in thousands):


Year	Payments
2026	$	4,053
2027	3,776
2028	3,721
2029	3,726
2030	3,755
Thereafter	3,129
Total lease payments	22,160
Less: imputed interest	(2,903)
Present value of lease liabilities	$	19,257

Management Fees

Prior to the Internalization, we paid quarterly Management Fees pursuant to the Legacy Management Agreement equal to 6.5% of the cash receipts from Royalty Investments (as defined in the Legacy Management Agreement) for such quarter and 0.25% of our security investments under GAAP as of the end of each quarter. The payment for our Management Fees was previously the most significant component of Payments for operating and professional costs presented in the consolidated statements of cash flows. Following the Internalization, we no longer pay Management Fees and instead, we compensate employees and pay other operating costs directly.

Guarantor Financial Information

Our obligations under the Notes are fully and unconditionally guaranteed by RP Holdings and RP Manager, aour non-wholly owned ~~subsidiary~~subsidiaries (together, the “Guarantor ~~Subsidiary~~Subsidiaries”). Our remaining subsidiaries (the “Non-Guarantor Subsidiaries”) do not guarantee the Notes. Under the terms of the indenture governing the Notes, Royalty Pharma plc and the Guarantor Subsidiary each fully and unconditionally, jointly and severally, guarantee the payment of interest, principal and premium, if any, on the Notes. As of December 31, 2024, the par value and carrying value of the total outstanding and guaranteed Notes was $7.8 billion and $7.6 billion, respectively.

7067

~~The~~Under ~~following~~the ~~financial~~terms ~~information~~of ~~presents~~the ~~summarized~~indenture ~~combined~~governing ~~balance~~the ~~sheet information as of December 31~~Notes, ~~2024, and summarized combined statement of operations information for 2024 for~~ Royalty Pharma plc and RPthe ~~Holdings.~~Guarantor ~~All~~Subsidiaries ~~intercompany~~each ~~balances~~fully and ~~transactions~~unconditionally, ~~between~~jointly ~~Royalty Pharma plc~~ and RPseverally, ~~Holdings~~guarantee ~~are eliminated in~~ the ~~presentation~~payment of ~~the~~interest, ~~combined~~principal ~~financial~~and ~~statements.~~premium, RPif ~~Holdings’ most significant asset is its investment in operating subsidiaries~~any, ~~which~~on ~~has been eliminated in~~ the ~~table below to exclude investments in Non-Guarantor Subsidiaries~~Notes. ~~Our~~As ~~operating subsidiaries hold the majority~~ of ~~our~~December ~~cash and cash equivalents~~31, ~~marketable securities and financial royalty assets. As a result~~2025, ~~our~~the ~~ability~~total tooutstanding ~~make~~and ~~required~~guaranteed ~~payments on the~~ Notes ~~depends~~had ona ~~the~~par ~~performance~~value ~~of our operating subsidiaries~~ and ~~their~~carrying ~~ability~~value towas ~~distribute funds to us~~$8.8 billion ~~There~~and ~~are no material restrictions on distributions from the operating subsidiaries~~$8.6 billion, ~~Amounts presented below do not represent our total consolidated amounts (in thousands):~~respectively.

Summarized Combined Balance Sheet
	As of December 31, 2024
Current assets	$	53,380
Current interest receivable on intercompany notes due from Non-Guarantor Subsidiaries	23,908
Current intercompany notes receivable due from Non-Guarantor Subsidiaries	242,476
Non-current assets	3,074
Non-current intercompany notes receivable due from Non-Guarantor Subsidiaries	2,430,894
Current liabilities	1,100,681
Current interest payable on intercompany notes due to Non-Guarantor Subsidiaries	23,905
Current intercompany notes payable due to Non-Guarantor Subsidiaries	242,476
Non-current liabilities	6,613,747
Non-current intercompany notes payable due to Non-Guarantor Subsidiaries	1,609,898

The following financial information presents summarized combined balance sheet information as of December 31, 2025, and summarized combined statement of operations information for 2025 for Royalty Pharma plc, RP Holdings and RP Manager. All intercompany balances and transactions between these entities are eliminated in the presentation of the combined financial statements. RP Holdings’ most significant asset is its investment in operating subsidiaries, which has been eliminated in the table below to exclude investments in Non-Guarantor Subsidiaries. Our operating subsidiaries hold the majority of our cash and cash equivalents, marketable securities and financial royalty assets. As a result, our ability to make required payments on the Notes depends on the performance of our operating subsidiaries and their ability to distribute funds to us. There are no material restrictions on distributions from the operating subsidiaries. Amounts presented below do not represent our total consolidated amounts (in thousands):

Summarized Combined Statement of Operations
Summarized Combined Balance Sheet
	Year Ended December 31, 2024
	As of December 31, 2025
Interest income on intercompany notes receivable due from Non-Guarantor Subsidiaries	$	104,167
Current assets	$	27,054
Other income	822
Current interest receivable on intercompany notes due from Non-Guarantor Subsidiaries	26,932
Operating expenses	251,831
Non-current assets	926,732
Interest expense on intercompany notes due to Non-Guarantor Subsidiaries	53,798
Non-current intercompany notes receivable due from Non-Guarantor Subsidiaries	3,011,820
Net loss	200,640
Current liabilities	515,312
Current interest payable on intercompany notes due to Non-Guarantor Subsidiaries	26,932
Non-current liabilities	9,147,894
Non-current intercompany notes payable due to Non-Guarantor Subsidiaries	2,208,840


Summarized Combined Statement of Operations
	Year Ended December 31, 2025

Interest income on intercompany notes receivable due from Non-Guarantor Subsidiaries	$	146,611
Other income	72,196

Operating expenses	725,272
Interest expense on intercompany notes due to Non-Guarantor Subsidiaries	72,010
Net loss	578,475

Critical Accounting Policies and Use of Estimates

The preparation of financial statements in accordance with generally accepted accounting principles in the United States requires the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses. Certain of these policies are considered critical as they have the most significant impact on our financial condition and results of operations and require the most difficult, subjective, or complex judgments, often because of the need to make estimates about the effect of matters that are inherently uncertain. On an ongoing basis, we evaluate our estimates that are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The result of these evaluations forms the basis for making judgments about the carrying values of assets and liabilities and the reported amount of income and expenses that are not readily apparent from other sources. Because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

Our most critical accounting policies relate to our financial royalty assets and the full descriptions can be found in Note 2–-Summary of Significant Accounting Policies to our consolidated financial statements. Similarly, the most significant judgments and estimates applied by management are associated with the measurement of our financial royalty assets at amortized cost using the prospective effective interest method. The application of the prospective approach to calculate interest income from our financial royalty assets requires management’s judgment in forecasting the expected future cash flows of the underlying royalties. These estimates and judgments arise because of the inherent uncertainty in predicting future events.

7168

We evaluate financial royalty assets for impairment on an individual basis by comparing the effective interest rate at each reporting date to that of the prior period. If the effective interest rate for the current period is lower than the prior period and if the gross cash flows have declined (expected and collected), management records a provision for the change in expected cash flows. The provision is measured as the difference between the financial royalty asset’s amortized cost basis and the net present value of the expected future cash flows, calculated based on the prior period’s effective interest rate. The amount recognized as provision expense increases the financial royalty asset’s cumulative allowance, which reduces the net carrying value of the financial royalty asset.

Factors Impacting Expected Future Cash Flows

The amounts and timing of forecasted expected future cash flows are largely influenced by sell-side equity research analyst coverage, commercial performance of the product and the royalty duration.

•Analyst coverage. ~~Forecasts~~Expected ~~of expected~~ future cash flows are ~~developed~~derived from sales projections offor the underlying biopharmaceutical products, asbased ~~published~~primarily inon sell-side equity research analyst ~~reports~~consensus forecasts. InThese ~~projecting~~forecasts ~~future~~incorporate ~~cash~~market ~~flows~~research on global economic conditions, ~~our~~industry trends and product life cycles. Our policy is to rely on sell-side research analysts’ consensus sales forecasts to derive annual sales projections for each financial royalty asset over the periods for which we are entitled to royalties or milestones. ~~These~~When ~~forecasts~~analyst ~~are~~estimates ~~based~~do onnot ~~market~~extend ~~research~~through ~~that~~the ~~analyzes~~full ~~factors~~royalty ~~such as growth in global economies~~term, ~~industry~~we ~~trends and product life cycles. We generally utilize statistical curves to~~ project future sales ~~for~~using ~~a portion of the royalty duration when sell-side equity research coverage ends or when estimates are not available for the duration of the royalty. The~~ statistical curves which are modelled ~~from~~using a combination of historical product trends and available ~~sell-side equity research analyst~~ consensus ~~sales~~ estimates. ~~Based~~Depending on the level of ~~detail~~details provided in ~~sell-side equity research~~ analyst models, management ~~can~~may ~~also be required to~~ apply additional assumptions to ~~the~~allocate annual sales ~~forecasts~~ to ~~estimate the~~ quarterly ~~and~~periods ~~geographical allocation from annual sales projections~~ and, ~~for~~by ~~franchised~~geographic ~~products~~regions, todetermine ~~estimate the~~ product ~~mix~~ and pricing mix for franchises, or to exclude ~~from projections~~ sales ~~forecasts~~ for unapproved products. ~~Our~~Contractual ~~contractual~~ royalty ~~terms,~~ rates, terms and ~~any~~ milestones are then applied to the adjusted sales projections to ~~calculate~~estimate the ~~expected~~ royalty or milestone payments over the ~~term of the financial royalty~~ asset’s life, forming the basis for ~~our forecast of~~ expected future cash flows used toin ~~calculate~~calculating and ~~measure~~measuring interest income.

•Commercial performance. The approval of a product for use in new indications can extend the date through which we are entitled to royalties or milestones on that product. For certain financial royalty assets, such as the cystic fibrosis franchise, we are entitled to royalties on approved combination products and on future combination products, which create new cash flow streams that were previously not reflected. We generally do not recognize income from, or forecast sales for, unapproved products unless they are incorporated into analyst consensus forecasts in such a way that we cannot isolate the probability of regulatory success that is built into analyst estimates. If a product is removed from all or a portion of a market, subsequent sell-side equity research analysts’ consensus sales forecasts will reflect the expected drop in sales. Both the new cash flow streams and the cessation of cash flow streams related to a product’s performance in the market over the royalty term can materially affect our forecast of expected future cash flows, which directly impacts the measurement of interest income.

•Royalty duration. The duration of a royalty can be based on a variety of factors, such as regulatory and marketing approval dates, patent expiration dates, the number of years from first commercial sale, the first date of manufacture of the patent-protected product, the entry of generics or a contractual date arising from litigation, which are all impacted by the point in time in the product’s life cycle at which we acquire the royalty. Royalty durations vary by geography as the United States, European Union and other jurisdictions may be subject to different country-specific patent protection terms or exclusivity based on contractual terms. Products may be covered by a number of patents and, where a royalty term is linked to the existence of valid patents, management is required to make judgments about the patent providing the strongest protection to align the period over which management forecasts expected future cash flows to the royalty term. It is common for the latest expiring patent in effect at the date we acquire a financial royalty asset to be extended, adjusted or replaced with newer dated patents subsequent to our acquisition of a royalty due to new information, resulting in changes to the royalty duration in later periods. Patents may expire earlier than expected at the time of the acquisition due to the loss of patent protection, loss of data exclusivity on intellectual property, contractual licensing terms limiting royalty payments based on time from product launch, recent legal developments or litigation. Macroeconomic factors, such as changes in economies or the competitive landscape, including the unexpected loss of exclusivity to the products underlying our portfolio of royalties, changes in government legislation, product life cycles, industry consolidations and other changes beyond our control could result in a positive or negative impact on our forecast of expected future cash flows and the related measurement of interest income.

Significant Assumptions Applied in Developing Forecasted Expected Future Cash Flows

As part of the preparation of the forecasted expected future cash flows, which relies on the sources and variables discussed above, management is required to make assumptions around the following forecast inputs: (1) estimates of the duration of the royalty, which includes consideration of the strength of patent protection and anticipated timing for entry of generics, (2) product growth rates and sales trends in outer years, generally projected through statistical curves, (3) the product and pricing mix for franchised products, (4) the geographical allocation of annual sales data from sell-side equity research analysts’ models, and (5) the portion of sales that are subject to royalties, which is referred to as royalty bearing sales. Generally the most significant and judgmental assumptions used in forecasting the expected future cash flows for our royalties include (1) estimates of the duration of the royalty and (2) sales trends and product growth rates in outer years of the royalty term, which are primarily derived from statistical models.

With respect to the cystic fibrosis franchise, forecasted expected future cash flows in ~~2024~~2025 are significantly impacted by prong 5 from above, the estimated royalty bearing sales. The forecasted expected cash flows for the cystic fibrosis franchise included consensus estimates for Vertex’s Alyftrek ~~following disclosure of its Phase 3 clinical data~~ and also included the conservative assumption that royalties will only be collected on the tezacaftor component of Alyftrek and not on the deuterated ivacaftor component. Although we believe that the deuterated ivacaftor component of Alyftrek is the same as ivacaftor and is therefore royalty-bearing, Vertex has made public statements that it believes the deuterated ivacaftor component is not royalty-bearing. If the forecasted expected cash flows for the cystic fibrosis franchise included the assumption that the deuterated ivacaftor component is royalty-bearing, ~~the~~in ~~impact~~2025, towe ~~our 2024 results of operations~~ would beexpect the ~~reduction~~impact ofto abe ~~cumulative~~reflected ~~allowance~~through ~~and~~higher ~~the~~interest ~~recognition of provision~~ income ~~of approximately $259~~prospectively.~~4 million.~~

The royalty duration is important for purposes of accurately measuring interest income over the life of a financial royalty asset. In making assumptions around the royalty duration for terms that are not contractually fixed, management considers the strength of existing patent protection, timing for expected entry of generics, geographical exclusivity periods and potential patent term extensions tied to the underlying product. It is common for royalty durations to expire earlier or later than anticipated due to unforeseen developments over time, including with respect to the granting of patents and patent term extensions, the invalidation of patents, litigation between the party controlling the patents and third party challengers of the patents, the ability of third parties to design around or circumvent valid patents, the granting of regulatory exclusivity periods or extensions, timing for the arrival of generic or biosimilar competitor products, changes to legal or regulatory regimes affecting intellectual property rights or the regulation of pharmaceutical products, product life cycles, and industry consolidations.

When royalty-bearing pharmaceutical products have limited or no coverage by sell-side equity research analysts, or where sell-side equity research analyst estimates are not available for the full term of our royalty, particularly for the later years in a product’s life, we generally incorporate a statistical curve developed using historical sales data and available consensus sales projections to forecast product sales over the remaining life of the product.

Even though we believe interest income from financial royalty assets and the associated non-cash provision for changes in expected cash flows are not indicative of our near-term financial performance and should not be used as a source for predicting future income or growth trends, changes in the aforementioned assumptions could result in a material impact to our financial statements. A shortened royalty term can result in a reduction in interest income, significant reductions in total royalty payments over time compared to expectations or a permanent impairment. If the effective interest rate is lower for the current period than the prior period and if the gross cash flows have declined (expected and collected), this would result in the immediate recognition of non-cash provision expense even though the applicable cash inflows will not be realized for many years into the future. Small declines in sell-side equity research analysts’ consensus sales forecasts over a long time horizon can result in an immediate non-cash income statement expense recognition, even though the applicable cash inflows will not be realized for many years into the future.

Below is a summary of the sensitivity of our current year results in relation to the royalty duration for our top three financial royalty assets that are uncapped based on net carrying value as of December 31, ~~2024~~2025. Because these are long-dated financial royalty assets, we have assumed a change of two years in the estimated duration to sensitize the financial statement impact. There have not been any significant changes to the estimated duration of expected future cash flows ~~for~~between ~~our~~2023 ~~top~~and ~~three~~2025 for the financial royalty assets ~~during~~displayed ~~2023~~below ~~and~~except ~~2022~~for the cystic fibrosis franchise. During 2024, the estimated duration for the cystic fibrosis franchise was extended from 2037 to a range of 2039 to 2041, reflecting the approval of Alyftrek. ~~Additionally, the estimated duration for Tysabri was extended in 2024 from an expiry of 2031 to 2035 due to analyst expectations around the sales performance of Tysabri’s biosimilar.~~

If the duration of these financial royalty assets were extended two years by assuming the statistically projected growth trends continue and all other royalty terms and assumptions remain unchanged, any impact to interest income would be recognized prospectively over the remaining expected life of the financial asset. As there would be no current impact to interest income, the sensitivity is not disclosed below. However, an extended duration for a financial royalty asset could result in the reduction of any existing cumulative allowance for changes in expected cash flows, which would be recognized in the current period as provision income and is reflected in the table below for these top three financial royalty assets. If the duration for these financial royalty assets were reduced by two years by eliminating the corresponding forecasted expected future cash flows in that two year period while keeping all other royalty terms and assumptions unchanged, we would recognize immediate incremental provision expense in the current period as a result of applying the prospective method of the effective interest rate methodology. The extension and reduction in royalty terms are modelled in isolation for purposes of the sensitivity disclosures below and do not include any consideration of the related allowance for current expected credit losses. The measurement of interest income from our financial royalty assets is recalculated each reporting period, which requires updates to various inputs and assumptions, including estimated royalty duration. Therefore, any actual impact to recognition of provision income or expense would be different than the sensitivity disclosure below. The impact of these sensitivity assumptions is summarized as follows (in thousands):

Year Ended December 31, 2024

Year Ended December 31, 2025

Estimated Royalty Duration(1)

Change in Duration Assumption Applied

Provision Income for Changes in Expected Cash Flows

Change in Duration Assumption Applied

Provision Expense for Changes in Expected Cash Flows

Cystic fibrosis franchise

2039-2041(2)

+ 2 years

~~(160,723)~~—

- 2 years

~~283~~216,~~088~~527

Trelegy

2029-2030

+ 2 years

(66,647)

- 2 years

281,188

Evrysdi

2035-2036

+ 2 years

(169,874)

- 2 years

218,787

Tysabri

(3)

+ 2 years

(31,357)

- 2 years

46,844

Voranigo

2038

+ 2 years

—

- 2 years

50,424

(1)Durations shown represent our estimates as of the current reporting date of when a royalty will substantially end, which may vary by geography and may depend on clinical trial results, regulatory approvals, contractual terms, commercial developments, estimates of regulatory exclusivity and patent expiration dates (which may include estimated patent term extensions) or other factors. There can be no assurances that our royalties will expire when expected.

(2)Royalty is perpetual. We estimate royalty duration of 2039-2041 due to expected Alyftrek patent expiration and potential generic entry thereafter leading to sales decline.

(3)Royalty is perpetual. We have applied an end date of 2035 for purposes of accreting income over the royalty term, which is periodically reviewed based on our estimates of impact from biosimilars.

Recent Accounting Pronouncements

See Note 2–-Summary of Significant Accounting Policies to our consolidated financial statements for additional information on recently issued accounting standards.

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk

We are subject to certain risks which may affect our results of operations, cash flows and fair values of assets and liabilities, including volatility in foreign currency exchange rates and interest rates. Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in the general level of U.S. interest rates, particularly because the nature of the marketable securities we hold. In order to manage our exposures, we follow established risk management policies and procedures, including the use of derivative financial instruments, such as swaps, rate locks and forwards. We do not enter into derivative instruments for trading or speculative purposes. The counterparties to these contracts are all major financial institutions.

Foreign Currency Exchange Risk

Our results of operations are subject to foreign currency exchange risk through transactional exposure resulting from movements in exchange rates between the time we recognize royalty income or royalty revenue and the time at which the transaction settles, or we receive the royalty payment. The current portion of Financial royalty assets accounts for the most common type of transactional exposure. Because we are entitled to royalties on worldwide sales for various products, there is an underlying exposure to foreign currency as the marketer converts payment amounts from local currencies to U.S. dollars using a quarterly average exchange rate. Therefore, cash received may differ from the estimated receivable based on fluctuations in currency. In addition, certain products pay royalties in currencies other than U.S. dollars, which also creates foreign currency risk primarily with respect to the Euro, British pound, Canadian dollar, Swiss franc and Japanese yen, as our functional and reporting currency is the U.S. dollar. To manage foreign currency exchange risk, we may periodically utilize non-deliverable forward exchange or other hedging contracts. We do not currently have any foreign exchange contracts in place.

Interest Rate Risk

We are subject to interest rate fluctuation exposure through our investments in money market accounts and marketable securities, the majority of which bear a variable interest rate. As of December 31, ~~2024~~2025, we held cash and cash equivalents of $~~929~~618.07 million, of which $~~360~~235.71 million was cash and $~~568~~383.36 million was invested in interest-bearing money market funds. As of December 31, ~~2023~~2024, we had cash and cash equivalents of $~~477~~929.0 million, of which $~~319~~360.67 million was cash and $~~157~~568.43 million was invested in interest-bearing money market funds.

The objectives of our investment policy are the preservation of capital and fulfillment of liquidity needs. In order to maximize income without assuming significant market risk, we maintain our excess cash and cash equivalents in money market funds and marketable securities, largely composed of investment grade, short to intermediate term fixed income and debt securities. Because of the short term maturities of our cash equivalents and the short term nature of our marketable securities, we do not believe that a decrease in interest rates would have any material negative impact on the fair value of our cash equivalents or marketable securities.

Our debt portfolio is managed on a consolidated basis and management makes financing decisions to achieve the lowest cost of debt capital and to maximize portfolio objectives. As of December 31, ~~2024~~2025, 100% of our outstanding Notes have fixed interest rates. We have a $1.8 billion Revolving Credit Facility, ~~with~~a $350 million Uncommitted Credit Facility and a $380 million Term Loan with variable interest ~~rate~~rates. ~~that~~The Revolving Credit Facility and the Uncommitted Credit Facility had no outstanding ~~borrowing~~borrowings ~~balance~~ as of December 31, ~~2024~~2025. We are subject to interest rate fluctuation exposure related to the ~~Revolving~~amounts ~~Credit~~drawn ~~Facility~~under ~~for~~ the ~~amounts~~credit ~~drawn~~facilities.

Credit and Counterparty Risk

We are exposed to credit risk related to the counterparties with which we do business. We are subject to credit risk from our royalty assets, our receivables and our financial instruments, primarily ~~derivative and~~ available for sale debt securities. The majority of our royalty assets and receivables arise from contractual royalty agreements that pay royalties on the sales of underlying pharmaceutical products in the United States, Europe and the rest of the world, with concentrations of credit risk limited due to the broad range of marketers responsible for paying royalties to us and the variety of geographies from which our royalties on product sales are derived. The products in which we hold royalties are marketed by leading biopharmaceutical industry participants, including, among others, Vertex, GSK, Biogen, Roche, Astellas, Pfizer, Johnson & Johnson, ~~Biogen,~~ AbbVie, ~~Astellas~~Servier, ~~Pfizer~~Gilead, ~~Novartis~~Amgen and ~~Gilead~~Alnylam. As of December 31, ~~2024~~2025 and ~~2023~~2024, Vertex, as the marketer and payor of our royalties on the cystic fibrosis franchise, accounted for 3432% and 3234% of our current portion of financial royalty assets, respectively, and represented the largest individual marketer and payor of our royalties. Refer to “Understanding Our Results of Operations” within this MD&A for a discussion of the royalty payors accounting for 10% or more of our total income and other revenues for ~~2024~~2025 and ~~2023~~2024.

We monitor the financial performance and creditworthiness of the counterparties to our royalty agreements, ~~derivative financial instruments,~~ and available for sale debt securities so that we can properly assess and respond to changes in their credit profile. To date, we have not experienced any significant losses with respect to the collection of income or revenue on our royalty assets or available for sale debt securities ~~or on the settlement of our derivative financial instruments~~. If a counterparty becomes bankrupt, or otherwise fails to perform its obligations under a derivative financial instruments due to financial difficulties, we may experience significant delays in obtaining any recovery under the derivative financial instruments in a bankruptcy or other reorganization proceeding.

7672

Item 8. Financial Statements and Supplementary Data

ROYALTY PHARMA PLC

Index to Audited Consolidated Financial Statements

Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42)			7874
Consolidated Balance Sheets as of December 31, 2024 and 2023			81
Consolidated Balance Sheets as of December 31, 2025 and 2024			79
Consolidated Statements of Operations for the years ended December 31, 2024, 2023 and 2022			82
Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023			80
Consolidated Statements of Comprehensive Income for the years ended December 31, 2024, 2023 and 2022			83
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2025, 2024 and 2023			81
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2024, 2023 and 2022			84
Consolidated Statements of Cash Flows for the years ended December 31, 2025, 2024 and 2023			82
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023 and 2022			85
Notes to Consolidated Financial Statements			83
Notes to Consolidated Financial Statements			86

7773

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Royalty Pharma plc

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Royalty Pharma plc (the Company) as of December 31, ~~2024~~2025 and ~~2023~~2024, the related consolidated statements of operations, ~~comprehensive income,~~ shareholders' equity and cash flows for each of the three years in the period ended December 31, ~~2024~~2025, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, ~~2024~~2025 and ~~2023~~2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, ~~2024~~2025, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, ~~2024~~2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 1211, ~~2025~~2026 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

7874

Critical Audit ~~Matter~~Matters

The critical audit ~~matter~~matters communicated below isare amatters ~~matter~~ arising from the current period audit of the financial statements that ~~was~~were communicated or required to be communicated to the audit committee and that: (1) ~~relates~~relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of ~~the~~ critical audit ~~matter~~matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit ~~matter~~matters below, providing a separate ~~opinion~~opinions on the critical audit ~~matter~~matters or on the accounts or disclosures to which itthey ~~relates~~relate.

			Valuation of Financial Royalty Assets and related Interest Income
Description of the Matter			As disclosed in Note 68 to the consolidated financial statements, the Company’s total financial royalty assets, net, were carried at $1517,~~910~~062,~~928~~868 thousand as of December 31, ~~2024~~2025. For the year ended December 31, ~~2024~~2025, the Company recognized income from financial royalty assets of $2,~~149~~261,~~422~~152 thousand. As explained in Note 2 to the consolidated financial statements, the Company’s financial royalty assets are measured at amortized cost using the prospective effective interest rate method. Auditing the valuation of the financial royalty assets and related interest income involved complex auditor judgment, because the assumptions used by management to forecast the expected cash flows from the underlying royalties are forward-looking and are therefore affected by future economic and market conditions, such as the impact of the entry of competing or generic products to the market, among other uncertainties. The key assumptions used in the valuation of the financial royalty assets and related interest income are product growth rates applied to forecasted sales and the royalty duration.
How We Addressed the Matter in Our Audit			We obtained an understanding, evaluated the design and tested the operating effectiveness of controls related to the valuation of financial royalty assets and related interest income. This included testing controls over management’s review of the significant assumptions and other inputs used in estimating the royalty duration and product growth rates.To test the valuation of the financial royalty assets and related interest income, our audit procedures included, among others, evaluating the methodology and completeness and accuracy of the data used to develop the key assumptions identified above. For example, with the support of statistical modelling specialists, we evaluated management’s statistical methodology for sales growth forecasts and performed sensitivity analysis over the resulting forecasted product sales. We also tested the inputs to the model, principally comprising historic product sales and third-party analyst estimates of nearer-term sales amounts, by comparing to analyst reports or published sales information. For royalty duration, among other procedures, we compared management’s assessment of the likely date of expiry of the Company’s cash ~~flows~~ﬂows against original purchase agreements, as well as independently assessing the royalty duration against available published information sources, such as those from regulatory bodies, counterparties, and product marketers. We assessed the historical accuracy of management’s estimates by comparing expected cash ~~flows~~ﬂows to actual cash receipts. We also evaluated the related disclosures in the consolidated financial statements.


			Initial recognition and valuation of Employee EPAs assumed as part of the Internalization
Description of the Matter			As described in Note 3 to the consolidated financial statements, on May 16, 2025, the Company completed its acquisition of Royalty Pharma Manager, LLC for total consideration of $565.2 million (the “Internalization”). The transaction was accounted for as a business combination. As a result of the Internalization the company recognized an initial liability related to Employee Equity Performance Awards (“Employee EPAs”) of $422.5 million. The initial recognition and valuation of the Employee EPAs required management to establish an accounting policy for the classification and measurement of the Employee EPAs and make significant judgments, estimates and assumptions. Auditing the initial recognition and valuation of the Employee EPAs was complex due to the judgment and estimation required by management. The complexity is due to the high subjectivity and estimation uncertainty of the assumptions used by management to estimate the fair value using the Monte Carlo Simulation model. The key assumptions used in the valuation of the Employee EPAs are product growth rates applied to forecasted sales and the duration of cash receipts.
How We Addressed the Matter in Our Audit			We obtained an understanding, evaluated the design and tested the operating effectiveness of controls related to the accounting and valuation of the Employee EPAs. This included testing controls over management’s review of the technical accounting considerations, significant assumptions, and other inputs used in estimating the valuation of the liability. To audit the Company's accounting policy for the initial recognition of the Employee EPAs we assessed the appropriateness of the conclusions reached in accordance with the applicable accounting principles. To test the valuation of the liability and related share-based compensation expense, our audit procedures included, among others, evaluating the methodology and completeness and accuracy of the data used to develop the key assumptions identified. For example, we engaged valuation specialists to gain an understanding of the approach taken by the Company and to assess the appropriateness of the methodology used, and to develop their own point estimate for the Employee EPA liability at fair value using the Monte Carlo Simulation. We also evaluated the related disclosures in the consolidated financial statements.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2022.

~~New York~~Boston, ~~New York~~Massachusetts

February 1211, ~~2025~~2026

7976

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Royalty Pharma plc

Opinion on Internal Control Over Financial Reporting

We have audited Royalty Pharma plc’'s internal control over financial reporting as of December 31, ~~2024~~2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Royalty Pharma plc (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, ~~2024~~2025, based on the COSO criteria.

WeAs ~~also~~indicated ~~have~~in ~~audited,~~the inaccompanying ~~accordance~~Management’s ~~with~~Report ~~the~~on ~~standards~~Internal ofControl ~~the~~over ~~Public~~Financial ~~Company~~Reporting, ~~Accounting~~management’s ~~Oversight~~assessment ~~Board~~of ~~(United~~and ~~States)~~conclusion ~~(PCAOB),~~on the ~~consolidated~~effectiveness ~~balance sheets~~ of ~~the~~internal ~~Company~~control asover offinancial ~~December~~reporting ~~31,~~did ~~2024~~not ~~and~~include ~~2023,~~ the ~~related~~internal ~~consolidated~~controls ~~statements~~covering a portion of ~~operations,~~general ~~comprehensive~~and ~~income,~~administrative ~~shareholders'~~expenses ~~equity~~attributable ~~and~~to cash ~~flows~~employee compensation for ~~each~~personnel of ~~the~~Royalty ~~three~~Pharma ~~years~~Manager, inLLC which constituted 7% of general and administrative expenses for the ~~period~~year ended December 31, ~~2024,~~2025. ~~and~~Our ~~the~~audit ~~related~~of ~~notes~~internal ~~and~~control ~~our~~over ~~report~~financial ~~dated~~reporting ~~February~~of ~~12,~~the ~~2025~~Company ~~expressed~~also did not include an ~~unqualified~~evaluation ~~opinion~~of ~~thereon~~internal control over cash employee compensation for personnel of Royalty Pharma Manager, LLC.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related statements of operations, shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes and our report dated February 11, 2026 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

~~New York~~Boston, ~~New York~~Massachusetts

February 1211, ~~2025~~2026

8078

ROYALTY PHARMA PLC

CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

	As of December 31,
	2024		2023
	2025		2024
Assets
Current assets
Cash and cash equivalents	$	~~929~~618,~~026~~696	$	~~477~~929,~~010~~026
Financial royalty assets	~~783~~854,~~770~~386		~~738~~783,~~438~~770
Available for sale debt securities	5818,~~200~~800		1858,~~300~~200
Other royalty income receivable	2629,~~956~~316		2226,~~405~~956
Other current assets	46,~~187~~893		184,~~040~~187
Total current assets	1,~~802~~528,~~139~~091		1,~~274~~802,~~193~~139
Financial royalty assets, net	1516,~~127~~208,~~158~~482		1415,~~088~~127,~~655~~158
Equity securities	~~186~~171,~~960~~312		~~199~~186,~~487~~960
Available for sale debt securities	~~693~~419,~~500~~000		~~437~~693,~~100~~500
Equity method investments	~~379~~289,~~424~~968		~~375~~379,~~894~~424
Other assets	33,534		6,522
Goodwill	924,634		—
Total assets	$	18,222,715	$	16,381,851
Other assets	79,293		33,534
Total assets	$	19,620,780	$	18,222,715
Liabilities and shareholders’ equity
Current liabilities
Distributions payable to legacy non-controlling interests	$	7572,~~811~~825	$	8375,~~155~~811
Accounts payable and accrued expenses	1319,~~370~~404		1513,~~165~~370
Interest payable	98110,~~062~~818		5198,~~682~~062
Current portion of long-term debt	~~997~~380,~~773~~000		—997,773
Other current liabilities	6853,~~600~~164		1168,~~375~~600
Total current liabilities	1636,~~253,616~~211		~~161~~1,~~377~~253,616
Long-term debt	68,~~614~~570,~~653~~917		6,~~135~~614,~~285~~653
Other liabilities	12,080		900
Accrued compensation liabilities	577,870		—
Total liabilities	7,880,349		6,297,562
Other liabilities	120,843		12,080
Total liabilities	9,905,841		7,880,349
Commitments and contingencies
Shareholders’ equity
Class A ordinary shares, $0.0001 par value; issued and outstanding: 2024–445,985 and 2023–446,692	45		45
Class A ordinary shares, $0.0001 par value; issued and outstanding: 2025–428,669 and 2024–445,985	43		45
Class B ordinary shares, $0.000001 par value; issued and outstanding: 2024–143,128 and 2023–150,743	—		—
Class B ordinary shares, $0.000001 par value; issued and outstanding: 2025–148,438 and 2024–143,128	—		—
Class R redeemable shares, £1 par value; issued and outstanding: 2024–50 and 2023–50	63		63
Class R redeemable shares, £1 par value; issued and outstanding: 2025–50 and 2024–50	63		63
Deferred shares, $0.000001 par value; issued and outstanding: 2024–392,255 and 2023–384,640	—		—
Deferred shares, $0.000001 par value; issued and outstanding: 2025–411,475 and 2024–392,255	—		—
Additional paid-in capital	4,~~103~~123,~~482~~088		4,~~011~~103,~~435~~482
Retained earnings	2,~~845~~356,~~653~~318		2,~~517~~845,~~583~~653
Non-controlling interests	3,~~395~~238,~~785~~039		3,~~557~~395,~~792~~785
Treasury interests	(2,~~662~~612)		(2,~~629~~662)
Total shareholders’ equity	109,~~342~~714,~~366~~939		10,~~084~~342,~~289~~366
Total liabilities and shareholders’ equity	$	1819,~~222~~620,~~715~~780	$	1618,~~381~~222,~~851~~715

See accompanying notes to these consolidated financial statements.

8179

ROYALTY PHARMA PLC

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

	Years Ended December 31,
	2024		2023		2022
	2025		2024		2023
Income and other revenues
Income from financial royalty assets	$	2,~~149~~261,~~422~~152	$	2,~~197~~149,~~754~~422	$	2,~~125~~197,~~096~~754
Other royalty income and revenues	~~114~~117,~~154~~041		~~156~~114,~~800~~154		~~112~~156,~~119~~800
Total income and other revenues	2,~~263~~378,~~576~~193		2,~~354~~263,~~554~~576		2,~~237~~354,~~215~~554
Operating expense
Operating (income)/expense
Provision for changes in expected cash flows from financial royalty assets	~~732~~(295,~~461~~838)		~~560~~732,~~656~~461		~~904~~560,~~244~~656
Research and development funding expense	2,000		52,000		177,106
Provision for credit losses on unfunded commitments	89,032		—		—
Amortization of intangible assets	—		—		5,670
Research and development funding expense	452,000		2,000		52,000
General and administrative expenses	236,671		249,748		227,303
General and administrative expenses (includes $290,890, $3,224, and $3,302 of share-based compensation expense for the years ended December 31, 2025, 2024 and 2023, respectively; see Note 4)	573,481		236,671		249,748
Financial royalty asset impairment	—		—		615,827
Total operating expense, net	818,675		971,132		862,404
Total operating expense, net	971,132		862,404		1,930,150
Operating income	1,559,518		1,292,444		1,492,150
Operating income	1,292,444		1,492,150		307,065
Other (income)/expense
Equity in (earnings)/losses of equity method investees	(29,611)		(28,882)		8,973
Equity in earnings of equity method investees	(29,089)		(29,611)		(28,882)
Interest expense	~~225~~307,~~512~~664		~~187~~225,~~187~~512		187,~~961~~187
Losses/(gains) on derivative financial instruments	6,000		2,290		(96,610)
Losses on derivative financial instruments	—		6,000		2,290
(Gains)/losses on equity securities	(39,549)		(87,139)		33,442
Losses/(gains) on equity securities	21,852		(39,549)		(87,139)
(Gains)/losses on available for sale debt securities	(154,906)		(230,840)		6,815
Gains on available for sale debt securities	(45,859)		(154,906)		(230,840)
Interest income	(4733,~~343~~591)		(7247,~~291~~343)		(7872,~~335~~291)
Other non-operating expenses, net	114,~~528~~349		211,~~737~~528		1421,~~755~~737
Total other (income)/expense, net	(38,369)		(207,938)		77,001
Total other expense/(income), net	235,326		(38,369)		(207,938)
Consolidated net income before tax	1,~~330~~324,~~813~~192		1,~~700~~330,~~088~~813		~~230~~1,~~064~~700,088
Income tax expense	—		—		—
Consolidated net income	1,~~330~~324,~~813~~192		1,~~700~~330,~~088~~813		~~230~~1,~~064~~700,088
Net income attributable to non-controlling interests	~~471~~553,~~830~~245		~~565~~471,~~254~~830		~~187~~565,~~232~~254
Net income attributable to Royalty Pharma plc	$	~~858~~770,~~983~~947	$	1858,~~134,834~~983	$	421,~~832~~134,834
Earnings per Class A ordinary share:
Basic	$	1.9279	$	21.5492	$	02.1054
Diluted	$	1.9178	$	21.5391	$	02.1053
Weighted average Class A ordinary shares outstanding:
Basic	~~448~~429,~~185~~801		~~447~~448,~~601~~185		~~437~~447,~~963~~601
Diluted	~~594~~564,~~108~~455		~~602~~594,~~900~~108		~~437~~602,~~972~~900

See accompanying notes to these consolidated financial statements.

8280

ROYALTY PHARMA PLC

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

	Years Ended December 31,
	2024		2023		2022
Consolidated net income	$	1,330,813	$	1,700,088	$	230,064
Other comprehensive income/(loss):
Unrealized gains on available for sale debt securities	—		—		24,000
Reclassification of unrealized gains on available for sale debt securities	—		—		(53,432)
Other comprehensive loss:	$	—	$	—	$	(29,432)
Comprehensive income	$	1,330,813	$	1,700,088	$	200,632
Comprehensive income attributable to non-controlling interests	471,830		565,254		175,418
Comprehensive income attributable to Royalty Pharma plc	$	858,983	$	1,134,834	$	25,214

See accompanying notes to these consolidated financial statements.

ROYALTY PHARMA PLC

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In thousands, except per share amounts)

	Class A Ordinary Shares			Class B Ordinary Shares			Class R Redeemable Shares			Deferred Shares			Additional Paid-in Capital		~~Additional~~Retained ~~Paid-in Capital~~Earnings		~~Retained~~Non-Controlling ~~Earnings~~Interests		~~Accumulated~~Treasury ~~Other Comprehensive Income~~Interests		~~Non-Controlling~~Total ~~Interests~~Shareholders’ Equity		~~Treasury Interests~~		~~Total Shareholders’ Equity~~
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount
Balance at December 31, 2021	432,963	$	43	174,213	$	—	50	$	63	361,170	$	—			$	3,507,533	$	2,255,179	$	16,491	$	4,471,951	$	(2,715)	$	10,248,545
Balance at December 31, 2022	443,166	$	44	164,058	$	—	50	$	63	371,325	$	—	$	3,666,160	$	1,964,689	$	3,897,223	$	(2,806)	$	9,525,373
Contributions	—	—		—	—		—	—		—	—		—		—		—11,855		—		11,~~596~~855		—		~~11,596~~
Distributions	—	—		—	—		—	—		—	—		—		—		—(487,721)		—		(~~604~~487,~~248~~721)		—		~~(604,248)~~
Dividends ($0.76 per class A ordinary share)	—	—		—	—		—	—		—	—				—		(333,322)		—		—		—		(333,322)
Dividends ($0.80 per class A ordinary share)	—	—		—	—		—	—		—	—		—		(358,327)		—		—		(358,327)
Other exchanges	1013,~~155~~315	12		(1013,~~155~~315)	—		—	—		1013,~~155~~315	—		428,629		~~156,457~~—		—(428,808)		~~1,127~~177		~~(157,494)~~—		~~(91)~~		—
Share-based compensation and related issuances of Class A ordinary shares	4857	—		—	—		—	—		—	—		2,357		~~2,170~~—		—		—		—2,357		—		~~2,170~~
Net income	—	—		—	—		—	—		—	—				—		42,832		—		187,232		—		230,064
Repurchases of Class A ordinary shares	(9,846)	(1)		—	—		—	—		—	—		(85,711)		(219,047)		—		—		(304,759)
Other comprehensive income/(loss):
Net income	—	—		—	—		—	—		—	—		—		1,134,834		565,254		—		1,700,088
Unrealized gains on available for sale debt securities	—	—		—	—		—	—		—	—				—		—		14,262		9,738		—		24,000
Purchase of non-controlling interest in RPCT	—	—		—	—		—	—		—	—		—		(4,566)		(11)		—		(4,577)
Reclassification of unrealized gains on available for sale debt securities	—	—		—	—		—	—		—	—				—		—		(31,880)		(21,552)		—		(53,432)
Balance at December 31, 2023	446,692	$	45	150,743	$	—	50	$	63	384,640	$	—	$	4,011,435	$	2,517,583	$	3,557,792	$	(2,629)	$	10,084,289
Balance at December 31, 2022	443,166	$	44	164,058	$	—	50	$	63	371,325	$	—			$	3,666,160	$	1,964,689	$	—	$	3,897,223	$	(2,806)	$	9,525,373
Contributions	—	—		—	—		—	—		—	—		—		—		9,038		—		9,038
Contributions	—	—		—	—		—	—		—	—				—		—		—		11,855		—		11,855
Distributions	—	—		—	—		—	—		—	—		—		—		(476,632)		—		(476,632)
Distributions	—	—		—	—		—	—		—	—				—		—		—		(487,721)		—		(487,721)
Dividends ($0.84 per class A ordinary share)	—	—		—	—		—	—		—	—		—		(376,465)		—		—		(376,465)
Dividends ($0.80 per class A ordinary share)	—	—		—	—		—	—		—	—				—		(358,327)		—		—		—		(358,327)
Other exchanges	7,615	1		(7,615)	—		—	—		7,615	—		166,275		—		(166,243)		(33)		—
Other exchanges	13,315	2		(13,315)	—		—	—		13,315	—				428,629		—		—		(428,808)		177		—
Share-based compensation and related issuances of Class A ordinary shares	81	—		—	—		—	—		—	—		2,344		—		—		—		2,344
Share-based compensation and related issuances of Class A ordinary shares	57	—		—	—		—	—		—	—				2,357		—		—		—		—		2,357
Repurchases of Class A ordinary shares	(8,403)	(1)		—	—		—	—		—	—		(76,572)		(153,340)		—		—		(229,913)
Repurchases of Class A ordinary shares	(9,846)	(1)		—	—		—	—		—	—				(85,711)		(219,047)		—		—		—		(304,759)
Net income	—	—		—	—		—	—		—	—		—		858,983		471,830		—		1,330,813
Net income	—	—		—	—		—	—		—	—				—		1,134,834		—		565,254		—		1,700,088
Purchase of non-controlling interest in RPCT	—	—		—	—		—	—		—	—		—		(1,108)		—		—		(1,108)
Purchase of non-controlling interest in RPCT	—	—		—	—		—	—		—	—				—		(4,566)		—		(11)		—		(4,577)
Balance at December 31, 2024	445,985	$	45	143,128	$	—	50	$	63	392,255	$	—	$	4,103,482	$	2,845,653	$	3,395,785	$	(2,662)	$	10,342,366
Balance at December 31, 2023	446,692	$	45	150,743	$	—	50	$	63	384,640	$	—			$	4,011,435	$	2,517,583	$	—	$	3,557,792	$	(2,629)	$	10,084,289
ASU 2025-07 adoption impact	—	—		—	—		—	—		—	—		—		(12,000)		—		—		(12,000)
Contributions	—	—		—	—		—	—		—	—		—		—		—9,983		—		9,~~038~~983		—		~~9,038~~
Distributions	—	—		—	—		—	—		—	—		—		—		—(541,262)		—		(~~476~~541,~~632~~262)		—		~~(476,632)~~
Dividends ($0.84 per class A ordinary share)	—	—		—	—		—	—		—	—				—		(376,465)		—		—		—		(376,465)
Dividends ($0.88 per class A ordinary share)	—	—		—	—		—	—		—	—		—		(378,317)		—		—		(378,317)
Other exchanges	719,~~615~~220	12		(719,~~615~~220)	—		—	—		719,~~615~~220	—		345,605		~~166,275~~—		—(345,657)		—50		~~(166,243)~~—		~~(33)~~		—
Share-based compensation and related issuances of Class A ordinary shares	81	—		—	—		—	—		—	—				2,344		—		—		—		—		2,344
Share issuances for EPAs, Equity Incentive Plans and related share-based compensation	877	—		—	—		—	—		—	—		27,889		(551)		108,945		—		136,283
Repurchases of Class A ordinary shares	(8,403)	(1)		—	—		—	—		—	—				(76,572)		(153,340)		—		—		—		(229,913)
Shares and share-based awards issued for Internalization	—	—		24,530	—		—	—		—	—		3,778		—		57,000		—		60,778
Net income	—	—		—	—		—	—		—	—				—		858,983		—		471,830		—		1,330,813
Repurchases of Class A ordinary shares	(37,413)	(4)		—	—		—	—		—	—		(357,666)		(869,414)		—		—		(1,227,084)
Purchase of non-controlling interest in RPCT	—	—		—	—		—	—		—	—				—		(1,108)		—		—		—		(1,108)
Net income	—	—		—	—		—	—		—	—		—		770,947		553,245		—		1,324,192
Balance at December 31, 2024	445,985	$	45	143,128	$	—	50	$	63	392,255	$	—			$	4,103,482	$	2,845,653	$	—	$	3,395,785	$	(2,662)	$	10,342,366
Balance at December 31, 2025	428,669	$	43	148,438	$	—	50	$	63	411,475	$	—	$	4,123,088	$	2,356,318	$	3,238,039	$	(2,612)	$	9,714,939

See accompanying notes to these consolidated financial statements.

8481

ROYALTY PHARMA PLC

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Years Ended December 31,
	2024		2023		2022
	2025		2024		2023
Cash flows from operating activities:
Cash collections from financial royalty assets	$	23,~~983~~354,~~410~~750	$	32,~~201~~983,410	$	23,~~507~~201,~~236~~410
Cash collections from intangible royalty assets	~~14,647~~720		114,~~302~~647		721,~~943~~302
Other royalty cash collections	~~108~~114,~~846~~021		~~158~~108,~~843~~846		69158,~~891~~843
Distributions from equity method investees	13,396		1813,~~823~~396		3918,~~142~~823
Interest received	4634,~~482~~308		7146,~~604~~482		2471,~~982~~604
Development-stage funding payments - ongoing	(2,000)		(2,000)		(2,106)
Development-stage funding payments	(452,000)		(2,000)		(52,000)
Development-stage funding payments - upfront and milestone	—		(50,000)		(175,000)
Payments for operating and professional costs	(288,138)		(236,225)		(243,012)
Payments for operating and professional costs	(236,225)		(243,012)		(222,969)
Payments for Employee EPAs	(10,943)		—		—
Interest paid	(~~159~~276,~~570~~291)		(~~169~~159,~~168~~570)		(~~170~~169,~~139~~168)
Net cash provided by operating activities	2,~~768~~489,~~986~~823		2,~~987~~768,~~802~~986		2,~~143~~987,~~980~~802
Cash flows from investing activities:
Distributions from equity method investees	23,641		43,882		—
Acquisition of businesses, net of cash acquired	(74,416)		—		—
Investments in equity method investees	(10,955)		(12,542)		(9,896)
Distributions from equity method investees	105,149		23,641		43,882
Purchases of equity securities	(62,500)		—		(87,785)
Investments in equity method investees	—		(10,955)		(12,542)
Proceeds from equity securities	98,575		—		211,158
Purchases of equity securities	(58,427)		(62,500)		—
Purchases of available for sale debt securities	(150,000)		—		(479,559)
Proceeds from equity securities	34,723		98,575		—
Proceeds from available for sale debt securities	19,786		1,440		542,044
Purchases of available for sale debt securities	(175,000)		(150,000)		—
Purchases of marketable securities	—		—		(234,869)
Proceeds from available for sale debt securities	21,226		19,786		1,440
Proceeds from sales and maturities of marketable securities	—		24,391		792,341
Proceeds from sales of available for sale debt securities	510,553		—		—
Acquisitions of financial royalty assets	(2,505,701)		(2,115,522)		(1,741,640)
Proceeds from sales and maturities of marketable securities	—		—		24,391
Acquisitions of other financial assets	(18,000)		—		(21,215)
Acquisitions of financial royalty assets	(1,697,729)		(2,505,701)		(2,115,522)
Milestone payments	(75,000)		(12,400)		—
Acquisitions of other financial assets	—		(18,000)		—
Other	2,039		(2,038)		—
Milestone payments	(271,313)		(75,000)		(12,400)
Net cash used in investing activities	(2,678,115)		(2,072,789)		(1,029,421)
Other	(8,946)		2,039		(2,038)
Net cash used in investing activities	(1,614,180)		(2,678,115)		(2,072,789)
Cash flows from financing activities:
Distributions to legacy non-controlling interests - Portfolio Receipts	(~~362~~354,~~280~~901)		(~~376~~362,~~987~~280)		(~~441~~376,~~963~~987)
Distributions to legacy non-controlling interests - other	—		—		(31,301)
Distributions to continuing non-controlling interests	(167,475)		(125,159)		(119,534)
Distributions to continuing non-controlling interests	(125,159)		(119,534)		(144,115)
Dividends to shareholders	(378,253)		(376,465)		(358,327)
Dividends to shareholders	(376,465)		(358,327)		(333,322)
Repurchases of Class A ordinary shares	(1,227,383)		(229,651)		(304,759)
Repurchases of Class A ordinary shares	(229,651)		(304,759)		—
Contributions from legacy non-controlling interests - R&D	220		747		543
Contributions from legacy non-controlling interests - R&D	747		543		1,059
Contributions from non-controlling interests - other	5,697		4,360		6,933
Contributions from non-controlling interests - other	4,360		6,933		6,133
Cash acquired in connection with purchase of non-controlling interest	—		—		4,973
Cash acquired in connection with purchase of non-controlling interest	—		4,973		—
Proceeds from revolving credit facility	1,275,000		—		350,000
Proceeds from revolving credit facility	—		350,000		—
Repayment of revolving credit facility	(1,275,000)		—		(350,000)
Repayment of revolving credit facility	—		(350,000)		—
Repayment of long-term debt	(1,000,000)		—		(1,000,000)
Repayment of long-term debt	—		(1,000,000)		—
Proceeds from issuance of long-term debt, net of discount	1,954,475		1,471,235		—
Proceeds from issuance of long-term debt, net of discount	1,471,235		—		—
Debt issuance costs and other	(16,563)		(12,616)		(1,596)
Debt issuance costs and other	(12,616)		(1,596)		(1,347)
Other	(1,790)		(9,026)		—
Other	(9,026)		—		—
Net cash (used in)/provided by financing activities	(1,185,973)		361,145		(2,148,754)
Net cash provided by/(used in) in financing activities	361,145		(2,148,754)		(944,856)
Net change in cash and cash equivalents	(310,330)		452,016		(1,233,741)
Net change in cash and cash equivalents	452,016		(1,233,741)		169,703
Cash and cash equivalents, beginning of period	929,026		477,010		1,710,751
Cash and cash equivalents, beginning of period	477,010		1,710,751		1,541,048
Cash and cash equivalents, end of period	$	618,696	$	929,026	$	477,010
Cash and cash equivalents, end of period	$	929,026	$	477,010	$	1,710,751

See accompanying notes to these consolidated financial statements.

8582

ROYALTY PHARMA PLC

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Purpose

Royalty Pharma plc is a public limited company ~~that was~~ incorporated under the laws of England and Wales ~~to facilitate the initial public offering (“IPO”) of our Class A ordinary shares~~. “Royalty Pharma,” the “Company,” “we,” “us” and “our” refer to Royalty Pharma plc and its subsidiaries on a consolidated basis. We are the largest buyer of biopharmaceutical royalties and a leading funder of innovation across the biopharmaceutical industry. Our principal asset is a controlling equity interest in Royalty Pharma Holdings Ltd (“RP Holdings”), a private limited company incorporated under the laws of England and Wales. We conduct our business through RP Holdings and its subsidiaries.

WePrior ~~control~~to ~~Royalty~~May ~~Pharma~~16, ~~Holdings~~2025, ~~Ltd~~we (“were externally managed by RP ~~Holdings”)~~Management, LLC, a ~~private~~Delaware limited liability company ~~incorporated~~(the ~~under~~“Legacy ~~the~~Manager” ~~laws~~or of“RPM”), ~~England~~pursuant ~~and~~to ~~Wales~~advisory and ~~U.K.~~management ~~tax~~agreements ~~resident~~(collectively, ~~through~~the ~~our~~“Legacy ~~ownership~~Management ofAgreement”). RPOn ~~Holdings’~~May ~~Class~~16, A2025, ~~ordinary~~we ~~shares~~completed (the ~~“RP~~Internalization ~~Holdings~~(as ~~Class~~defined ~~A Interests”~~below) and RPbecame ~~Holdings’~~an ~~Class~~integrated Bcompany ~~ordinary~~with ~~shares (~~the ~~“RP~~former ~~Holdings~~employees ~~Class~~of BRPM ~~Interests”).~~becoming Weemployees ~~conduct~~of ~~our~~Royalty ~~business~~Pharma, ~~through~~LLC, a wholly-owned subsidiary of RP Holdings. ~~and~~Refer ~~its~~to ~~subsidiaries.~~Note 3-Internalization for additional discussion.

RP Holdings is the sole owner of Royalty Pharma Investments 2019 ICAV (“RPI 2019 ICAV”), which is an Irish collective asset management vehicle, and is the successor to Royalty Pharma Investments, an Irish unit trust (“Old RPI”). RP Holdings is owned by Royalty Pharma plc, and, indirectly, by RPI US Partners 2019, LP, a Delaware limited partnership, and RPI International Holdings 2019, LP, a Cayman Islands exempted limited partnership (together, the “Continuing Investors Partnerships”). Prior to the Exchange Offer (defined below), Old RPI was owned by various partnerships (the “Legacy Investors Partnerships”).

RP Management, LLC (the “Manager”), a Delaware limited liability company, is responsible for our management, including our day-to-day operations, pursuant to advisory and management agreements (collectively, the “Management Agreement”). In January 2025, we agreed to acquire the Manager for approximately $1.1 billion in total consideration (the “Internalization”). Refer to Note 16–Subsequent Events for additional discussion.

We are the largest buyer of biopharmaceutical royalties and a leading funder of innovation across the biopharmaceutical industry. We fund innovation in the biopharmaceutical industry both directly and indirectly - directly when we partner with companies to co-fund late-stage clinical trials and new product launches in exchange for future royalties, and indirectly when we acquire existing royalties from the original innovators.

2. Summary of Significant Accounting Policies

Basis of Preparation and Use of Estimates

The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of income, revenues and expenses during the reporting period. Actual results may differ from those estimates.

Basis of Consolidation

The consolidated financial statements include the accounts of Royalty Pharma and all majority-owned and controlled subsidiaries, as well as variable interest entities, where we are the primary beneficiary. We consolidate based upon evaluation of our power, through voting rights or similar rights, to direct the activities of another entity that most significantly impact the entity’s economic performance. For consolidated entities where we own or are exposed to less than 100% of the economics, we record Net income attributable to non-controlling interests in our consolidated statements of operations equal to the percentage of the economic or ownership interest retained in such entities by the respective non-controlling parties, except for the RP Holdings Class C Interests (as defined below), which are recorded based on their rights.

86RP Holdings is owned by Royalty Pharma plc, and, indirectly, by various partnerships (the “Continuing Investors Partnerships”) and, post-Internalization, by the Holders of RP Holdings Class E Interests (as defined below). RP Holdings is the sole owner of Royalty Pharma Investments 2019 ICAV (“RPI 2019 ICAV”), which is an Irish collective asset management vehicle and is the successor to Royalty Pharma Investments, an Irish unit trust. In 2022, we became an indirect owner of an 82% economic interest in Royalty Pharma Investments ICAV, which was previously owned directly by Royalty Pharma Investments. In connection with the Internalization, Royalty Pharma Investments distributed all of its assets to Royalty Pharma Investments 2011 ICAV (together with Royalty Pharma Investments ICAV, “Old RPI”).

We consummated an exchange offer on February 11, 2020 (the “Exchange Offer”) to facilitate our initial public offering (“IPO”). Prior to the Exchange Offer, Royalty Pharma Investments was owned by various partnerships (the “Legacy Investors Partnerships”). Through the Exchange Offer, investors which represented 82% of the aggregate limited partnership in the Legacy Investors Partnerships exchanged their limited partnership interests in the Legacy Investors Partnerships for limited partnership interests in RPI US Partners 2019, LP and RPI International Holdings 2019, LP which are part of the Continuing Investors Partnerships. Following the Exchange Offer, we became the indirect owner of an 82% economic interest in Royalty Pharma Investments which entitled us to 82% of the economics of its wholly-owned subsidiary RPI Finance Trust, a Delaware statutory trust (“RPIFT”), and 66% of Royalty Pharma Collection Trust, a Delaware statutory trust (“RPCT”). In December 2023, we acquired the remaining 34% interest in RPCT owned by Royalty Pharma Select Finance Trust, a Delaware statutory trust (“RPSFT”).

ROYALTY PHARMA PLC

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

We ~~consummated~~report anfour ~~exchange~~non-controlling offer on February 11, 2020 (the “Exchange Offer”) to facilitate the IPO. Through the Exchange Offer, investors which represented 82% of the aggregate limited partnership in the Legacy Investors Partnerships exchanged their limited partnership interests: in the Legacy Investors Partnerships for limited partnership interests in the Continuing Investors Partnerships. Following the Exchange Offer, we became the indirect owner of an 82% economic interest in Old RPI through our subsidiary RPI 2019 Intermediate Finance Trust, a Delaware statutory trust. We are entitled to 82% of the economics of Old RPI’s wholly-owned subsidiary RPI Finance Trust, a Delaware statutory trust (“RPIFT”), and 66% of Royalty Pharma Collection Trust, a Delaware statutory trust (“RPCT”).

In1.The ~~2022,~~Legacy weInvestors ~~became~~Partnerships’ anownership ~~indirect owner~~ of anapproximately 8218% ~~economic~~in ~~interest~~Old inRPI, ~~Royalty~~which ~~Pharma~~is ~~Investments~~the ~~ICAV~~only ~~(“RPI~~remaining ~~ICAV”),~~historical ~~which~~non-controlling ~~was~~interest ~~previously~~that ~~owned~~existed ~~directly~~prior byto ~~Old~~our ~~RPI~~IPO.

In2.The ~~December~~Continuing ~~2023,~~Investors ~~RPI~~Partnerships’ ~~2019~~indirect ~~ICAV~~ownership ~~acquired the remaining interest~~ in ~~RPCT~~RP ~~owned~~Holdings bythrough ~~Royalty~~their ~~Pharma~~indirect ~~Select~~ownership ~~Finance~~of ~~Trust,~~RP aHoldings’ ~~Delaware~~Class ~~statutory~~B ~~trust~~ordinary ~~(“RPSFT”),~~shares ~~at which time RPSFT ceased to hold a non-controlling interest in RPCT. Prior to December 2023,~~ (the ~~remaining~~“RP ~~34%~~Holdings ofClass ~~RPCT~~B ~~was owned by the Legacy Investors Partnerships and RPSFT, which was wholly owned by Royalty Pharma Select, an Irish unit trust~~Interests”).

Following the above transaction in December 2023, we report three non-controlling interests: (1) the Legacy Investors Partnerships’ ownership of approximately 18% in Old RPI and RPI ICAV, which existed prior to our IPO, and, following the consummation of our IPO, (2) the Continuing Investors Partnerships’ indirect ownership in RP Holdings through their indirect ownership of RP Holdings Class B Interests (the “continuing non-controlling interests”) and (3).Pablo ~~RPI EPA Vehicle, LLC~~Legorreta’s ~~(“EPA~~ultimate ~~Vehicle”)~~ ownership of the RP Holdings’ Class C ordinary share (the “RP Holdings Class C Special Interest”). ~~Income~~which ~~will~~entitles ~~not~~him beto ~~allocated~~receive toEquity ~~EPA~~Performance ~~Vehicle~~Awards ~~until~~(the ~~certain~~“Founder’s ~~performance~~Equity”). ~~conditions~~See ~~are~~discussion ~~met~~in Note 5-Shareholders’ Equity.

4.The Sellers’ (as defined in Note 3-Internalization) indirect ownership in RP Holdings through their indirect ownership of RP Holdings’ Class E ordinary shares (the “RP Holdings Class E Interests”). In connection with the Internalization, we issued 24.5 million RP Holdings Class E Interests to the Sellers (the “Holders of RP Holdings Class E Interests”), subject to vesting conditions, as part of the transaction consideration.

The Continuing Investors Partnerships, the Founder’s Equity and the Holders of RP Holdings Class E Interests, collectively, are referred to as the “continuing non-controlling interests.”

All intercompany transactions and balances have been eliminated in consolidation.

Reclassification

Certain prior period amounts have been reclassified to conform to the current period presentation.

Concentrations of Credit Risk

Financial instruments that subject us to significant concentrations of credit risk consist primarily of ~~cash~~financial ~~and~~royalty ~~cash equivalents~~assets, available for sale debt securities, and receivables. The majority of our financial royalty assets, ~~derivatives~~ and receivables. ~~Our~~arise ~~cash~~from ~~management~~contractual ~~and~~royalty ~~investment~~agreements ~~policy~~that ~~limits~~entitle ~~investment~~us ~~instruments~~ to ~~investment-grade~~royalties ~~securities~~on ~~with~~ the ~~objective~~sales toof ~~preserve~~underlying ~~capital~~biopharmaceutical products in the United States, Europe and tothe ~~maintain~~rest ~~liquidity~~of ~~until~~the world, with concentrations of credit risk limited due to the ~~funds~~broad ~~are~~range ~~needed~~of marketers responsible for ~~operations.~~paying ~~Our~~royalties ~~cash~~to us and ~~cash~~the ~~equivalents~~variety ~~balances~~of asgeographies offrom ~~December~~which 31our royalties on product sales are derived. The products in which we hold royalties are marketed by leading industry participants, ~~2024~~including, ~~and~~among ~~2023~~others, ~~were~~Vertex, ~~held~~GSK, ~~with~~Biogen, ~~Bank~~Roche, ofAstellas, ~~America~~Pfizer, ~~State~~Johnson ~~Street~~& Johnson, TDAbbVie, ~~Bank~~Servier, ~~Citibank~~Gilead, UAmgen and Alnylam.S. ~~Bank~~As of December 31, ~~DNB~~2025 ~~Bank~~and 2024, Vertex, as the marketer and ~~Scotiabank.~~payor ~~Our~~of ~~primary~~our ~~operating~~royalties ~~accounts~~on ~~significantly~~the ~~exceed~~cystic fibrosis franchise, accounted for 32% and 34% of our current portion of financial royalty assets, respectively, and represented the ~~Federal~~largest ~~Deposit~~individual ~~Insurance~~marketer ~~Corporation~~and ~~limits~~payor of our royalties.

The majority of our financial royalty assets and receivables arise from contractual royalty agreements that entitle us to royalties on the sales of underlying biopharmaceutical products in the United States, Europe and the rest of the world, with concentrations of credit risk limited due to the broad range of marketers responsible for paying royalties to us and the variety of geographies from which our royalties on product sales are derived. The products in which we hold royalties are marketed by leading industry participants, including, among others, Vertex, GSK, Roche, Johnson & Johnson, Biogen, AbbVie, Astellas, Novartis, Pfizer and Gilead. As of December 31, 2024 and 2023, Vertex, as the marketer and payor of our royalties on the cystic fibrosis franchise, accounted for 34% and 32% of our current portion of financial royalty assets, respectively, and represented the largest individual marketer and payor of our royalties.

We monitor the financial performance and creditworthiness of the counterparties to our royalty agreements so that we can properly assess and respond to changes in their credit profile. To date, we have not experienced any significant credit losses with respect to the collection of income or revenue on our royalty assets.

87Recently Adopted and Issued Accounting Standards

In September 2025, the Financial Accounting Standards Board (“FASB”) issued amendments which refine the scope of the guidance on derivatives in Accounting Standards Codification (“ASC”) 815 and clarify the guidance on share-based payments from a customer in ASC 606 (“ASU 2025-07”). ASU 2025-07 adds a new scope exception to the derivative guidance for contracts, such as certain research and development funding arrangements, that are not traded on an exchange and contain an underlying that is based on the operations or activities specific to one of the parties involved. ASU 2025-07 is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted in any interim or annual period for which financial statements have not yet been issued or made available for issuance.

ROYALTY PHARMA PLC

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~Recently~~We ~~Adopted~~adopted ASU 2025-07 in 2025 using the modified retrospective transition method, effective January 1, 2025. The only impact of adopting this standard related to the CK-586 R&D funding arrangement, which we entered into in 2024 and ~~Issued~~had ~~Accounting~~previously ~~Standards~~accounted for as a derivative. As of December 31, 2024, this derivative had a carrying amount of $12.0 million recorded within Other Assets. Upon reassessment under the new guidance, we concluded that the CK-586 funding arrangement qualifies for the derivative scope exception. Accordingly, we recorded a $12.0 million cumulative-effect adjustment to the opening balance of retained earnings as of January 1, 2025 to derecognize the derivative asset and reflect the CK-586 funding arrangement as R&D expense.

InThe ~~November~~scope ~~2023,~~clarification ~~the Financial Accounting Standards Board issued a new accounting standard that amends the guidance~~ for ~~required~~share-based ~~disclosures related to a public entity’s reportable segments (ASU 2023~~non-~~07).~~cash ~~The~~consideration ~~ASU~~from expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss. It also requires disclosure of the amount and description of the composition of other segment items and interim disclosures of a ~~reportable~~customer ~~segment’s~~in ~~profit or loss and assets. Public entities with~~ a ~~single~~revenue ~~reportable~~contract ~~segment~~is ~~are~~not ~~required~~applicable to ~~provide~~us. ~~the~~As ~~new~~such, ~~disclosures~~we ~~and~~adopted ~~all~~this ~~the disclosures required under ASC 280. This~~ update ~~became~~on ~~effective~~December ~~for~~31, us2025 inon ~~2024~~a ~~and~~prospective ~~our expanded disclosures are included below under “Segment Information~~method.”

In November 2023, the FASB issued a new accounting standard that amends the guidance for required disclosures related to a public entity’s reportable segments (“ASU 2023-07”). The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss. It also requires disclosure of the amount and description of the composition of other segment items and interim disclosures of a reportable segment’s profit or loss and assets. Public entities with a single reportable segment are required to provide the new disclosures and all the disclosures required under ASC 280. This update became effective for us in 2024 and our expanded disclosures are included below under “Segment Information.”

Segment Information

Our CODM is our Chief Executive Officer, who reviews financial information presented on a consolidated basis to allocate resources, evaluate financial performance and make overall operating decisions. As such, we concluded that we operate as one single reportable segment, which is primarily focused on acquiring biopharmaceutical royalties. The measure of segment profit or loss that is most consistent with our consolidated financial statements is consolidated net income. The accounting policies of our single reportable segment are the same as those for the consolidated financial statements. The level of disaggregation and amounts of significant segment expenses that are regularly provided to the CODM are the same as those presented in the consolidated statements of operations. Likewise, the measure of segment assets is reported on the consolidated balance sheets as total assets.

Royalty Assets

An acquisition of a royalty asset provides the buyer with contractual rights to cash flows from the sale of patent-protected biopharmaceutical products by unrelated biopharmaceutical companies. The majority of our royalties provide us with rights that are protective and passive in nature. In other words, we do not own the intellectual property or have the right to commercialize the underlying products. These contractual cash flow rights ~~have yield components that most closely resemble loans and~~ are classified as financial royalty assets.

In the limited instances where we possess rights to exploit the underlying patents, rights to the intellectual property related to t

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